In this blog article, I will discuss the question Do I need life cover? …………
I know so many people who insure their pets, their mobile phones but they do not insure themselves. Even people with young families. They do not stop to think what would happen if something happened to them.
Whether or not you need life cover, will depend on a number of factors. The first thing to consider is what you would want to happen should you die.
What do you want to happen should you die?
What you would want to happen should you die is a very important question. Do you want to your partner/dependents to be able to pay off the mortgage? Do you want your partner to maintain their current lifestyle? Do you want your children’s life to have as little disruption as possible? Would you like your funeral to be paid for? If you answered yes to any of these questions, you should ask yourself how this would be achieved.
Is it only the main earner who needs life cover?
You may feel that you only need to cover the life of the main earner. This may be because the other partner earns significantly less and a loss of their earnings will not have a significant impact on the household income. Or they may provide the childcare. However, life cover should not be discounted in these circumstances. If they died, would you not want to spend more time with your children to support them? This could lead to a loss of earnings. And who would provide your childcare? And how would you pay for this?
If you do not have any dependents or a house, you may feel that you do not need life cover. That a lump sum would not be required upon your death however, it may be worth considering.
But I have death in Service Cover
If you have death in service cover through your employer, you may feel that you do not need any additional cover however, you will need to make sure this is sufficient to cover your mortgage, the loss of earnings, childcare costs and so on. It is also worth bearing in mind that should you leave your employer, there is no guarantee another employer will offer the same benefits and if any medical conditions arise in the mean-time, you may struggle to get cover.
How much cover do I need?
This depends upon what you would want to happen upon your death and will also depend upon your budget. As mentioned in my previous blog “What is Life Cover?” if you are thinking about taking out life cover, it is worth speaking to a Financial Adviser to make sure you get the right cover for you.