Insurance

Is life insurance worth it? 

There are a few key 'life triggers' where life insurance may make sense for you. Let's look at what they are, together with a few considerations – just a few minutes to think it through now could pay dividends later. 

As an example, £250,000 of level term Life Insurance cover could cost as little as £7.96 per month. These premiums are fixed and guaranteed throughout the policy term. (Based on £250,000 level term Life Insurance cover with Lega; & General over a 30-year term for a 25-year-old female non-smoker – quote accurate as at 22/04/24).   

Some insurers offer fantastic free additional benefits such as AIG Smart Health - which gives you, your partner and children under 21 unlimited FREE access to: • 24/7 online GP appointments • Second medical opinions from Best Doctors • Personalised mental health support • Online health checks • Specialist nutrition consultations • Tailored fitness programmes 

When to consider life insurance 

Most people take out life insurance to protect their children and dependents, those who rely on them financially should the worst happen. It pays out either a lump sum or regular payments to dependents if you die, giving you the reassurance that they'd be looked after if you're no longer there to contribute.

People normally think about life insurance at big milestones, such as buying a house, becoming a parent or getting married. Ask yourself: 

- Would my death have a financial impact on my partner or children? 

- Would those I leave behind be able to cope with keeping up with repayments such as the mortgage, bills and have enough cash for everyday living? 

Banks and insurers may stress the importance of taking out cover, but it's really a personal decision about whether paying a few pounds a month for peace of mind is good value in your specific circumstances. For instance, you might not need life insurance if you're single, on a low income and eligible for state benefits, or your partner earns enough to cover all your outgoings. If you're not sure, at Main Mortgage Services we are here to help and provide sound, expert advice.  

How much cover do you need? 

Insurers quote by age and health status, but you also need to have an idea of how much you'd like the policy to pay out. Again, this really depends on your personal circumstances, but you might factor in: 

- Your mortgage – and its term 

- Other loans and debts 

- The amount of money it would take to maintain your dependents' standard of living, including replacing your income, paying for childcare, and covering everyday expenses. 

It also might depend on how much you can afford in monthly premiums. We can recommend suitable cover to fit your preferred budget.  

Are you already covered? 

Many employee benefits packages include 'death in service', which typically pays out a a multiple of your salary. It's worth noting that whilst employer death in service is good to have, it’s not deemed suitable to protect a mortgage debt, as you'll only be covered while you work for that employer, with cover ending if you ever moved to a different employer. 

Types of Life Insurance -  

- Level term – you pay a fixed, guaranteed premium over a set term. The insurer will pay out the agreed lump sum if you die within that time – usually to support loved ones or pay off an interest-only mortgage. 

- Decreasing term – works the same as level term, but the amount insured decreases over the term of the policy (which brings the cost of premiums down). This is often used to cover a repayment mortgage, where the amount owed reduces over time. 

- Family income benefit – works the same way as a level term policy, except it pays out a regular income instead of a tax-free lump sum.  

Life insurance is there should the worst happen – but what about other scenarios where you might not be able to keep up with your bills or mortgage?  

Other types of insurance we provide advice on are: 

Critical Illness Cover– designed to provide a tax-free lump sum, sufficient to repay your mortgage in full, if you suffer a serious illness, as set out in the policy. 

Income protection – provides a guaranteed tax-free monthly income if you are unable to work due to sickness or an accident. Cover is tailored to suit your own circumstances, taking into account any employer sick pay you may receive, and is available to both employed and self-employed workers.  

With access to the major reputable life insurance firms – AIG, Aviva, Guardian, Legal & General, Vitality, Liverpool Victoria, Zurich and Royal London, we can arrange affordable bespoke cover for you. 

Our advice in this important area is always free. Whether you have no cover in place or wish to review any existing cover, we will provide expert guidance. 

Flexible appointment times are available, including evenings and weekends. 

Main Mortgage Services is an Appointed Representative of Stonebridge Mortgage Solutions Ltd, which is authorised and regulated by the Financial Conduct Authority. Proprietor: Gordon Main  

Your home may be repossessed if you do not keep up repayments on your mortgage.  

As with all insurance policies, conditions and exclusions will apply.