Whether you're looking to provide a financial safety net for your loved ones, moving house or a first time buyer looking to arrange your mortgage life insurance - or simply wanting to add some cover to what you've already got - you'll want to make sure you choose the right type of cover and get a great deal too.
Our life insurance is a quick and easy way to arrange cover that pays out a lump sum to your loved ones if you die during the term of the plan. Although remember, there is no cash-in value at any time, so if you stop your monthly payments or survive to the end of the policy, your cover will end and no money will be returned to you.
Life insurance is a basic form of protection cover. The idea behind it is that should you die or suffer from a terminal illness the contract will pay a sum of money to normally repay any liabilities you may have or to help provide money for a family. It is one of the very oldest forms of financial cover that exists today; life cover has been around for hundreds of years and has evolved from notions that were around at the time. These principles were based around helping thy neighbour. It was common practice at the time if your house burned to the ground, then all the residents in the area would all pull together and help rebuild it for you. It was then Tonti in the 17th Century who took the life insurance to the next level which makes it more recognisable to what we see today. He put a more financial slant on the cover and brought calculations into how it is worked out. He created a fund that a number of people paid into and then at the end of each year the fund was split among all the people who had survived. This was very popular and many people wanted to sign up to the life cover. As it got bigger and bigger, he had to modify the life insurance policy and brought what we recognise as actuarial calculations into the equation. These are when things such as life expectancy and claims history are also taken into consideration, which is similar to today. You can see the life insurance and general life cover definition as we know it today in these early roots. The definition basically is the sharing of losses; this is substituting a certain loss (the policy premium) for a large uncertain loss (payout). You can then take the definition a stage further and see that it is a product that is designed to accomplish financial goals and assist if you were unfortunate enough to suffer from an economic loss due to the death of the insured. This life assurance protection can then create a lump sum payment to ensure that you accomplish financial need and make up for the economic loss you have suffered. This can prove invaluable to those who are left behind and the life insurance can really make a difference.
Once you understand this many people ask the question from the protection provider if it is really needed? In many cases it is needed, if you have any form of financial liability or if you have a family then you should normally consider getting a life insurance quote and taking a policy. There are numerous forms of protection and these are designed to suit the different situations that you may be appropriate to you. There are those of us that are purely interested in replacing lost income to the family. If you were to die then your weekly or monthly salary could be missed into the household. You need to ask yourself can your family survive without this income or would they find it a struggle to continue. If the answer to this is yes then some form of protection from a protection provider is definitely worth considering. You can choose an amount that you are comfortable with and have this as your sum assured for your life insurance quote. Many people think that the best way to work this out is to do multiples of your yearly salary. If you use this system, it is one of the oldest and most common forms of deciding your sum assured. This is the easiest formula to use and most of the financial experts use this system to compare polices on offer by the protection providers you decide to use. This is by far the simplest method available, however you must take into consideration the fact that it is a guide and doesn’t account for changes in circumstances and other factors that may occur in the future. Many people say this is simply a guess and it is not scientific enough. There is no perfect method out there as some people have their own ideas or formulas that they think is better for them, but what you should do is decide what the most appropriate need is for you. We all have different situations and circumstances that must be catered for so understanding the different methods available from your protection provider and getting the right life insurance quote is important.
Life Cover
In addition to the main methods there are a number of other reasons why people obtain life cover. These are very varied and offer a broad spectrum to cover most eventualities. Many people may simply want to cover funeral expenses; it is often the case that some older people take this so family do not end up with a large bill after the funeral. Others will obtain this form of life cover protection for peace of mind just in case they pass away and would have preferred to leave enough money for their child to still have a good potential education, after all university can be very expensive. Another popular reason for taking up life insurance quotes is for self employed people. If you were to have your own business and it was reliant upon you to survive, a life assurance policy could be needed to cover any key member of the business. If you want to give money to charity with your insurance you can obtain life cover quotes that will allow this. This could allow you to give a gift to your favourite charity and will not directly affect the size of your estate you are leaving to your family. Another possible reason for us to consider life assurance quotes or life cover is to help cover taxes that maybe be payable upon your death, however it would be better to consider whole life insurance rather than term life insurance as this would be for a defined period. The life assurance could cover these taxes so it is not an extra burden to your family along with everything else when you pass away. As we have seen there are several reasons for taking the cover. Overall it is important to consider that your potential liabilities or a family that would end up being worse off if you were to die then it is best advice to consider cover. The amount of life cover you decide to take is purely up to you, often you may find what you want can be expensive and may not be feasible. You tend to make a decision about your life cover with a financial head on but this is often combined with an emotional concern to it.
When obtaining a life insurance quote you can also look to cover any debts that you may have. Some people do not realise that when they pass away their debts are automatically passed onto their next of kin. In this scenario not only do your loved ones have the grief to deal with that you have passed away they also have the fact that they may be liable for the debts you had whilst you were alive. It is for this reason that it is always good advice to cover any liabilities that you have. For many of us the biggest liability we have is our mortgage. It is for this reason that there is specific insurance designed to cover mortgages. Many mortgages decrease over a specific term so you can obtain your life insurance that decreases alongside your mortgage. This is also a very cost effective way of obtaining cover as the liability to the protection provider is reducing over a specific period of time so the premiums they offer are cheaper. Some of us have interest only mortgages, if this is the case when you get your life insurance quote it should be on a level basis. This should then ensure that your mortgage is repaid as the cover will remain at a constant amount. With an interest only mortgage the liability doesn’t reduce over time. You are expected to make other arrangements to ensure that the mortgage is repaid. When you obtain a life insurance quote for this form of cover you will realise it is more expensive than the decreasing type. In addition to mortgages many people also have loans, credit cards, student debt and car finance that they need to cover. These can also be covered with this form of protection. After realising the differences between the 2 main types of protection you can see why some people have a need for both of them. It is seen in the industry as best advice to do a combination of both of them. If you cover your mortgage and then also add enough protection to provide an income in the event of death you have left your family in a strong position so long as the life insurance quote is affordable.
Life Assurance
There are many people who get confused with what the actual product life assurance is? Assurance means that something will definitely occur and is assured to happen during a period of time. The only thing you are not sure of is when this time is going to occur. Whereas insurance is when to take cover against something that possibly may occur during a certain period of time. If you decide that a term life insurance policy is the one that suits your needs best then this is a life assurance plan, as it is definitely going to pay at some period of time. If you take a normal term insurance type of plan then this will run over a set length of time and if no claim is made on the term life insurance policy during this time the plan will simply stop and no payment will be made. A life assurance plan is widely used for things such as funeral expenses. The reason for this is that it will provide a lump sum of money upon the death of the policy holder, this money is then ideal for covering these types of costs as they can come as a surprise and can be quite expensive. By providing the money for situations such as this it will take the pressure away from what can be a very traumatic experience and make it a bit easier. Which ever way you decide to take your insurance it is important that you get the best plan that suits your needs. It is always if you are unsure to talk to a protection specialist who can guide you and ensure you know the differences between a life assurance or a life insurance policy. The last thing you want is to find you have the wrong plan and it is not going to achieve the protection goal you purchased in the first place for. Any kind of protection plan like this is age sensitive, this means the older you get the more expensive the premiums are. This means if you get the wrong policy it can be prohibitively expensive to get the correct policy if and when you realise it is not for you.
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