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Is it time to consider life insurance?

Is it time to consider life insurance?

Category: Life insurance

Updated: 26/11/2012
First Published: 02/09/2010

This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.
The sad truth is that the vast majority of people will never consider taking out a life insurance policy, less actually take one out.

Unless you have stumbled across this article, it's probably safe to assume that you're thinking about the practicalities of life insurance.

Perhaps you've just started a family or have recently been married? Or you may think that life insurance would help to safeguard your loved ones' futures should something happen.

Whatever your reason, you can congratulate yourself on giving more thought to life insurance – often referred to as term insurance – than most people do.

The benefits are well documented, but are still worth detailing

The policy holder pays in a set amount a month – premiums can be as little as £5 per month – for an agreed period, which could be five, ten, twenty years or more.

This arrangement allows you to pick a set period in which a payout, should something happen, would be particularly helpful.

You may wish to organise a policy that protects you during the time that your children are dependent on your income, for example, or when your partner and yourself have significant financial obligations.

If you are in a couple, you can also take out a joint life policy that would pay-out in the event of either of you passing away.

NatWest Life Insurance offers both joint life cover for you and your partner or family life cover with up to 90 days instant cover while your application is processed and a 30 day money-back guarantee, which means you can decide at your own pace and cancel if you find a better option. The Natwest Life cover offers 2 - 40 year terms for UK residents aged 18 - 54.

A good example of affordable life cover comes from Barclays Life, which is provided by Aviva Life Insurance. Barclays Premiums start from only £5 a month – working out as just 17p a day – and applicants get 18% off if they buy online. Monthly premiums stay the same throughout the term and a 35 year old non-smoking woman could pay £14 a month for £250,000 of level term life cover for 25 years.

Over 50s may want to consider a plan from Tesco Life Insurance, which starts from just £7 a month and pays out a lump sum if you die after two years. UK residents aged between 50 and 80 are guaranteed to be accepted, with no medical and no health questions to answer. Your monthly premium will never increase and the amount you're insured for will never fall.

The Post Office is also worth a look, offering over 50s life insurance cover from just 25p a day.

As you would expect, should something happen after the agreement expires, no payment would be forthcoming, so for permanent cover, a whole-of-life policy might be the best arrangement.

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.