Do you need life insurance ?

Basically, if you have dependents or a mortgage then it is recommended.

Consider what would happen if you die today. Would your family be able to cope financially if you have insufficient life insurance or no cover at all? Just spend a few moments thinking about the income your family will lose if you die, and the amount they will receive if you die from any existing cover.

The only people who don't need cover are those with no dependants at all. However some mortgage lenders will insist that you take insurance even if you have no dependants.

How much cover do I need?

A good rule of thumb is to take life insurance for 20 x your annual net income plus the amount of any mortgages or loans. This will mean that on your death any debts can be cleared, and the residual lump sum can be invested producing a regular income that will replace the income you were bringing in to the household.

If you can't afford to pay for the amount of cover you should ideally have then set a budget and ask us how much life insurance that will buy.

What term should I select for my insurance ?

To answer this question you simply need to ask yourself why you are taking the cover in the first place.

If you are protecting a mortgage loan, it would be sensible to choose the same term for your life insurance as your mortgage.

If you have children, then consider taking life insurance until your youngest child will reach an age where you would expect them to be financially independent. Alternatively, if your spouse would suffer financially, you must consider having life insurance until retirement age.

What is life insurance ?

You may also see life insurance referred to as 'term insurance', 'life cover' or 'life assurance' - all these terms mean the same thing. Life insurance is financial protection for your dependants in the event of your untimely death.

You pay premiums to the life insurance company in return for being covered for the 'sum assured', which is the amount that will be paid out on death.

The cost of cover will vary depending on the size of the 'sum assured', your age, occupation, gender, whether you smoke and the term of the policy. Pre existing medical conditions may also affect the price you pay for insurance.

All of the protection policies named above have benefits and drawbacks. Drawbacks can include exclusions and limits to the amount of cover. We will discuss these with you before we make a recommendation.

How can I save money on life insurance ?

You can save money by shopping around for cover. Our website is ideal because we access all the major insurers - saving you from the task of visiting many different sites.

The other way to save money is to stop smoking. Non-smoker premiums are significantly lower. Please note that you must not have used any tobacco product (including patches) for the last 12 consecutive months to be classified as a non-smoker

Do I pay tax on the payout from a life policy ?

The payout from a policy is tax free, however, the money could then form part of your estate and be assessed for inheritance tax. This could account for 40% of your payout unless you are careful.

The easiest solution is to write your life insurance into trust. This means any payouts are made directly to your chosen beneficiaries, thus avoiding your estate.

If you require any further information regarding Inherence Tax Planning, you should seek the advice of a Financial Advisor.

How much does life insurance cost ?

Life Insurance premiums start from just £5 a month. The premium shown is the minimum premium.
Your cover will depend on your individual circumstances and needs and the premium you choose to pay.
The more you pay, the greater the benefits you stand to receive if and when the policy pays out.
There are no hidden extras. Why not get a quote online for life cover right now?

How are life insurance premiums calculated?

Life Insurance premiums are based mainly on:
your age,
your sex,
your occupation,
whether you smoke,
your medical history,
the level of cover you need,
the type of contract you choose.
For example, the older you are, the higher your life insurance premium will be.

If we decide to take out a joint life policy will the sum assured be paid twice ?

No, the life cover that is detailed in your quote and confirmed in your policy document is the amount paid in the event of a valid claim. The sum assured will be paid on the first death, or diagnosis of a terminal illness, to the surviving policy holder. The policy will end and no further benefits will be payable.

What is Level Term Life Assurance ?

Level Term means the amount you are insured for (sum assured) remains the same throughout the term of your policy.

What is Decreasing Term Assurance ?

This cover is similar to level life assurance, however with Decreasing Term Assurance the cover amount (sum assured) decreases over time.
Since your monthly premium is fixed but the sum you're insured for decreases roughly in line with a repayment mortgage, it's generally cheaper than Level Term Assurance.

What is Critical Illness Cover ?

Critical illness insurance is designed to ease the financial pressures by paying a tax-free lump sum if you become seriously ill or totally disabled.
You must normally survive at least one month after becoming critically ill, before the policy will pay out.