Nobody likes to consider the prospect of death, but if you want to ensure that your family are looked after when you pass away, it’s important to be prepared.
Putting life insurance in place can be a good way to gain more peace of mind, knowing that your loved ones have a financial safety net even if the worst should happen.
If you’ve considered getting protected but aren’t sure if it’s the right decision for you, read on to see if you’re one of the four types of people who should consider life insurance.
1. People with a mortgage
One of the main groups of people who can benefit from taking out life insurance are those who have a mortgage to pay. This particularly applies to young people, who typically have less financial security.
According to research by Legal & General, around two-fifths of millennials don’t have any life insurance in place. Of these, a third admitted that if they passed away then their partner would be unable to keep up with mortgage payments.
Buying a house is a significant financial commitment, which is why it’s important to make sure that you and your partner are protected if the worst should happen.
If you passed away before the end of the mortgage period, your insurance typically pays out a lump sum to your beneficiary, which they can use to cover the remaining amount. Having this protection in place can give you peace of mind to know that your loved ones will be able to remain in your home should you pass away.
2. Business owners
If you own a business, your family’s financial wellbeing could be significantly impacted by your death. To make sure that your loved ones don’t struggle after you pass away, it’s important to have insurance in place.
One of the most obvious benefits is that if your family rely on the profit from the business, your death could mean that they suffer financially. Having life insurance in place can mean that they are looked after even if they were to lose this income.
Furthermore, if you and your partner are co-owners in the business, your death can be a significant disruption to its operations. Not only may your partner need time to grieve, which may result in time off work, but the company may not operate as effectively once they return.
If this is the case, the business may not be as profitable as it once was, which can pose problems for your loved ones. Having life insurance in place can mean that they have a financial cushion which can make this issue easier to deal with.
Having protection in place can also mean that your loved ones don’t have to sell the business, which you poured so much time and energy into, just to get by after you’ve passed away.
3. Parents
If you have people who depend on you, there could be serious consequences if you were to pass away unexpectedly. This is especially true if you are the main or only earner in your household.
If your partner didn’t have enough income to support themselves and your children after you pass away, they may have to put up with a significantly reduced standard of living. This may have a detrimental effect on your children’s futures, as the financial difficulties may clip their wings before they’ve been able to fly the nest.
If you want to ensure that this doesn’t happen, it’s important to seek financial protection. Having life insurance in place would mean that your family would be provided for while they adjusted to your loss, giving them time to recover and get their finances back in order.
4. Couples
Many couples do their financial planning together, as it can often make sense to consider themselves as one unit when thinking about money. This is why it’s important to protect yourself against the unexpected, as if you were to suddenly pass away then your partner could suffer financially.
For example, if you had joint debts and rely on both of your incomes to stay on top of them, your death could have serious consequences as your partner may struggle to keep paying the bills.
When a loved one passes away, the last thing you want to think about is money. That’s why putting the right protection in place can be a good way to give the both of you some peace of mind, to know that you would be able to get by even if the worst should happen.
Get in touch
If you think you would benefit from life insurance, but aren’t sure which type is right for you, get in touch. Please email info@investmentsense.co.uk or call 0115 933 8433.
Life Assurance plans typically have no cash in value at any time and cover will cease at the end of term. If premiums stop, then cover will lapse.
