Very few people rush out to buy life insurance; it isn’t something most people like to think about all that much. In the UK, an alarming number of those who have taken on debts have no protection in place at all.
If your children, partner or relatives depend on your income to cover any financial commitments or expenses, you should be considering life insurance. Although we hope you’d never need it, having personal protection in place will secure your family’s financial future should any unexpected or tragic circumstances occur.
WHAT DO I NEED TO KNOW ABOUT LIFE INSURANCE?
Life insurance is designed to pay out a pre-determined tax-free lump sum upon the death of an insured person to protect the family’s expenses or help pay off the mortgage, helping to ensure loved ones aren’t put in a financially difficult position.
Many clients take out life insurance at the same time as their mortgage and set it up for the same term, as it is usually paid in monthly premiums until you cancel it. However, there are different types of insurance to consider, depending on your financial situation:
• Level Term Insurance – the level of cover will not change over time. If your death falls within the term of the policy, the total sum assured will be paid out to your family.
• Decreasing Term Insurance – the level of cover will gradually decrease over the term of the policy. Many people take this cover out to run alongside a repayment mortgage or any other long term liability.
• Whole of Life Assurance – this is a life insurance that provides cover during the life of the policyholder.
• Life Insurance in Trust – Establishing life insurance into a simple trust can be hugely beneficial from a tax planning point of view and can ensure your dependents access to funds quickly when they need them the most. Enness can put you in touch with expert tax advisors to discuss this.
HOW CAN ENNESS HELP WITH LIFE INSURANCE?
Whether you’re a single or double income household, the financial impact of your death could leave your family unable to cover mortgage payments or day to day expenses, thus putting them at risk of losing your home and livelihoods.
We can help you find the best policy so you have the peace of mind that you and your family will be protected, no matter what the future holds.