Life insurance Updated:
When it comes to insurance cover, it seems that life insurance is the big elephant in the room. According to a study by TopCashback, around two-thirds of Britons have no life cover whatsoever, despite half of this figure being parents. Life cover, it would appear, rides low in the priority list of UK residents.
No one likes to think about their own mortality, so it's perhaps not that surprising that buying life insurance is often overlooked. This could explain why more immediately obvious things, such as car insurance, home insurance and travel insurance, were found to be far more common forms of cover taken out by UK households.
When questioned about their lack of life insurance, half of respondents declared that it had never crossed their minds or that they had investigated it and found it too expensive. This suggests that there is a worrying amount of apathy among the British public, which could expose them and their families to financial difficulties should they pass away. It's sometimes all too easy to think "It'll never happen to me", but sadly it always pays to be prepared.
Of those who did purchase life insurance, men tended to outnumber women. The majority were also aged between 21 and 30, which perhaps indicates that younger generations are more wised up to the possibilities of fate.
The survey also uncovered regional variations among those who did and did not buy life insurance cover. For example, the North West had the highest number of people with life insurance cover, while Scotland had the least. This suggests that priorities differ depending on where you live in the UK.
Life cover may appear to be one of those things that see you hand over money to the insurance company only to never see it again, but having a life insurance policy can give you peace of mind that your family will be able to cope financially should the worst happen. Life insurance ensures that any debts you have get repaid, that your funeral expenses are covered, and that your family can maintain their current standard of living.
When household budgets are tight, siphoning off some of your precious cash towards life cover may seem expensive, but it doesn't have to be this way. Whole of life cover is the most comprehensive form of life insurance – it'll pay out when you die, no matter when that is – but that also makes it the most expensive. There are alternative policies that will provide cover for a set period, and these tend to be the cheaper options.
A level term policy will cover your family financially if you die within a term you specify. This can be very useful if you have a mortgage, as you can buy cover that will insure you while it's being repaid. Level term insurance can be increasing or decreasing, with the latter often being the cheaper of the two.
A decreasing term policy has the amount to be paid out on your death decrease over the term of the cover. Again, this is useful if you just want to protect your family from debts like a mortgage – the amount of cover will decrease in line with the amount owed on the mortgage. An increasing term policy, however, is the opposite, with the amount paid growing over the term of the cover. This is a flexible policy that is designed to protect you and your family as your life circumstances change (such as on the birth of a child).
But, no matter what type of cover you go for, there is another way you can keep costs down – shop around to compare your options. Why not check out our life insurance comparison tool to get your search started? If you'd like some more information on the options available first, take a look at our insurance guides to get the facts you need.
Read our life insurance guides
Get life insurance quotes from our comparison tool
Disclaimer: Information is correct as of the date of publication (shown at the top of this article). Any products featured may be withdrawn by their provider or changed at any time.
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