The aim of life protection is to protect your family and those who are dependent on you for financial support in the event of your death. Certain types of life insurance can also include add-on protection which can benefit you directly whilst you are alive, such as critical illness cover.
Who is it for?
The first thing to consider is who will be affected if you die. Do you have a spouse, partner, children or other dependants? If so your death is likely to have an impact on their future lives as your income to the household will be lost with you. You need to leave them in a position that they can manage financially for possibly many years after you have gone.
Families with children particularly need to be provided for. It costs a small fortune to support a child to the age of 21, including education and living costs. It will still be a cost you are not contributing to if you have died.
Joint parents will both need insuring even if they are not earning – as their contribution to the household and family, including domestic chores and childcare, would be costly to replace if they die.
If you are planning to start a family your life insurance needs should be considered before the process is even begun. Even if the father should die whilst you are pregnant, that baby is still coming!
For joint mortgage holders there is an obvious need to protect each other in case of death or long term illness. Often both incomes are used to obtain the mortgage, and it would become unaffordable if just one income remained. Cover can be arranged to produce lump sums or regular income to mitigate the financial effects.
Single people are not excluded from the need for some cover. Most of us would leave some debt behind if we died, even if it is only a funeral bill! Added to this are the legal and other costs of winding up your estate. Would you really want to leave someone else with the financial burden of dealing with this?
Can older people get insurance?
When you get older the need for life protection may seem to reduce, especially if you are more financially secure. But the premature death of a partner can leave a big hole in the lifestyle of the person left behind. Will you still be able to afford a replacement car, and holiday like you have been used to? Also consider how long your savings might last? Whilst you might never get over the loss of a partner, simple life assurance plan can mitigate the financial effects.
We offer a range of life protection products to meet your needs, which are summarised here.
For detailed advice and recommendations for life insurance, Lincoln adviser Robert Drury can guide you.
THE PLAN WILL HAVE NO CASH IN VALUE AT ANY TIME AND WILL CEASE AT THE END OF THE TERM. IF PREMIUMS ARE NOT MAINTAINED, THEN COVER WILL LAPSE.