Do you need life insurance?

Do you need life insurance?

This may sound daft, but many people don’t stop to ask themselves this question. And it is one that needs to be asked. So, here’s a little information on the subject to help you understand what you need to consider in order to be able to decide for yourself.


First things first, not everyone needs life insurance. However, if your family depend upon either just you, or you and your partner, for income to cover your mortgage and other living expenses, then you need to at least consider it. In the event of your death, it will help provide for your dependents.

So, what is life insurance?

You won’t be surprised to learn that there are many different types of policy available to you. However, in essence, a life insurance policy is designed to provide your family with either a lump sum, or regular payments, in the event of your death. How much they will receive depends on the amount of cover you take out. And it’s worth noting that you can take out policies for specific things like your mortgage if you’d prefer. The best thing to do is discuss your particular circumstances with your financial adviser so that they can point you towards the most appropriate product for you.

What does life insurance not cover?

As the title suggests, it covers only death. So it isn’t a policy designed to provide for you and your family in the event of illness or disability.

Also, you should be aware that many policies will have certain exclusions. For example, if you die as a result of drug or alcohol abuse, this may not be covered. Risky hobbies may require an additional premium. And if you already have a serious health problem, this may be excluded too. Make a note of everything and talk it through with your adviser. There may be other types of policy available to you to cover exclusions, long term illness, and critical illness, which might meet your requirements better.

So, do you need it?

The question to ask yourself first is this: ‘What will happen to my family’s ability to pay the bills and mortgage if I die?’. The government cannot be relied upon to take care of them in the manner in which you’d probably like them to be looked after. And if this is the case, then you really do need to consider a life insurance policy.

However, if you’re single or your partner earns enough for your family to live on, you may decide that life insurance isn’t necessary.

Is it expensive?

It’s not really appropriate for us to answer that directly, because the answer is relative to your circumstances and approach to your family’s finances. However, many people deem it to be good value. For just a few pence a day, you may have access to a policy that will provide your family with the protection they need in the event of your death. Though, of course, this is always subject to your age and health status.

First off, ask your financial adviser to provide examples of the cost of different policies. Premiums do vary, and they will know which institutions can offer the best products for your situation.

What affects the cost of life insurance?

There are many different factors that can affect the size of the premium. However, examples include:

  • The sum you wish to cover
  • The length of the policy
  • Your age
  • Your health
  • Your lifestyle
  • Whether you smoke, etc.

Things to check…

Before you decide to take out a life insurance policy, it is worth checking if your employer already provides one. However, if you find you do have some sort of cover as a benefit, then it’s also worth checking that it provides enough. If it isn’t enough, there is no reason you can’t take out an additional life insurance policy to make up the difference. Of course, if you stop working for that employer in the future, you won’t have the benefit of their policy any more.

Other types of insurance to consider…

If you’re interested in finding out more about the different types of insurance available to you, click the links below:

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