Life insurance – can you afford to be without it?

Nobody really knows what the future has in store. Have you ever wondered how your loved ones would cope if you died unexpectedly? It is not an easy subject to think about however it is really important to consider just what sort of financial situation you would leave behind.

Life insurance can offer a solution in providing much needed financial security for dependents in the event of death. Taking out a life insurance policy is a straightforward and popular way to protect your loved ones financially.

Life Insurance cover is essentially protection for you, your family and your lifestyle. Here are some examples of how life insurance can ease the financial burden in the case of death.

Pay off your mortgage.
Help finance your dependants’ present and future education costs.
Provide finance to help your family maintain their lifestyle.
Pay off any credit card or personal loan debts.

There are two main types of non investment fixed term life insurance, Level Term Life Insurance and Decreasing Term Life Insurance these are generally the cheapest form of protection and can offer high levels of life insurance cover for relatively low premiums.

Level Term Life Insurance is designed to pay out a fixed cash lump sum in the event of your death, on this type of policy the sum insured remains constant throughout the term of the policy. A level term life insurance policy can be set up as either a single life plan or as a joint life first death policy, where the sum insured is payable on the first death. Most policies include cover for diagnosis of a terminal illness during the plan term at no extra cost.
Decreasing term Life Insurance can help care for your family's financial situation by paying off the outstanding balance of the mortgage on your home with a cash sum should you die before the end of the term of your policy. The level of coverage is designed to decrease in line with the outstanding balance on a standard repayment mortgage.

Like Level Term Life insurance you can take out Decreasing Term Life Insurance on a single or joint life basis, with the cash sum being paid out on the first claim only. You choose the number of years the policy will be in place and the level of mortgage life cover your require at the outset of the plan, policies normally include cover for diagnosis of a terminal illness during the plan term at no extra cost.
A point worth noting is that in general Life Insurance companies charge smokers an average of 60% more for their life insurance than non-smokers.
The cost of Life insurance can vary greatly between different providers so it is therefore well worth shopping around to compare prices to get the best deal.

Life insurance premiums have come down in price over the last few years, this is thought to be down to a combination of factors including strong pricing competition in the industry and advances in medical technology (people are generally living longer!), so if you have existing cover it is well worth comparing the cost of your existing cover to what is available in the market place today.

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