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Life Insurance
A lump sum for the people you love, if the worst happens. We find the right cover for your mortgage, your children, or both.
What is Life Insurance?
Life Insurance is insurance that pays out a ‘large’ sum of money if you pass away during a specified period of time. These types of policies are also known as Term Life Insurance policies.
Life Insurance is required to protect people against sizeable financial risks / liabilities – in our lifetime the two biggest expenses that we have are mortgages and children.
Do I need life insurance?
The easy way to figure out if you need life insurance is to ask yourself “if I passed away then would my surviving partner or family have enough money to pay off the mortgage and/or pay for the cost of my children’s upbringing”.
If the answer is “no” then you need life insurance in place – it’s that simple.
Do you need life insurance for a mortgage?
While some lenders require it, life insurance is not a mandatory product (like car insurance).
However, it is a sensible idea to have life insurance in place to pay off the mortgage in the event of your death.
It all depends on what you need to cover – either a mortgage or children or both.
If you only have a mortgage to protect then you would need a decreasing policy. This type of policy covers the exact mortgage balance and runs for the length of your mortgage.
The value of the policy will reduce in line with your mortgage – and if you pass away the policy will pay out the exact amount of money to pay off the mortgage.
If you have a mortgage and children then the most suitable type of policy would be a level policy. This type of policy covers an amount that is chosen by you – which should be the same or higher than your mortgage – and the policy can run for as long as you choose but will usually be set to run for the length of the mortgage or the number of years before you children become financially independent. The value of this policy will never reduce – so it will pay out the full amount regardless of when you pass away.