Posted by & filed under Health, Life Insurance, Protection - Insurance.

Life insurance is something many of us would never dream is relevant to them. I mean, it’s not like we’re going to die any time soon is it?

Life Insurance

Well – not wanting to state the obvious, but none of us really know when we’re going to die. It could be in 50 years’ time or equally it could be next week (we’re sorry to be the barer of such gloomy news).

Either way, it’s never nice to think about it but that doesn’t mean we shouldn’t.

Life insurance is a vital part of financial planning for anyone who has dependents. By ‘dependents’, we’re referring to those whose circumstances and material well-being would be affected by your death. So that means your partner, your children or anyone else who is financially reliant on you.

It can make the difference between your loved ones struggling financially and maybe having to move home or them being able to pay the mortgage / rent and maintain a similar standard of living while coming to terms with your death.

So how does life insurance work?

Life insurance comes in a variety of forms. At its simplest, it pays out an agreed amount, either as a lump sum or as a regular income if you die within a specified period, known as the ‘term’. Hence it is often called term insurance and this term can be anything, typically from a minimum of 10 years upwards.

Just like with any insurance, you will need to choose a level of cover. Remember, this is the amount you’re dependents will receive if the unthinkable happens so make sure it will cover all the bills and allow them to live comfortably.

Most policies will have some exclusions. For example, they may not pay out if you die due to drug or alcohol abuse, and you normally have to pay extra to be covered when you take part in risky sports so it’s important to check the small print.

If you have a serious health problem when you take out the policy, your insurance may also exclude any cause of death related to that illness.
One last thing to remember is that life insurance is just that, it’s insurance for your life (or lack of it) and will not cover you for illness or loss of earnings in any other circumstances.

Later on in this blog series we’ll be covering other types of insurance and how we can help you take a “portfolio approach” to cover all eventualities.

Don’t want to wait for the next blog?

Find out all about how Credius can assist with setting up your insurance on our website, just click here.

Contact Credius today at info@credius.com or call on 020 7562 5858 for independent advice and a free consultation. To keep up to date with the finance and mortgage markets follow this link to subscribe for regular expert news and views direct to your mail.

Next time – How to lower the cost of your life insurance

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