This is a question a lot of people ask these days. It used to be the case that anyone taking out a mortgage thought that they HAD to have life insurance. In fact, lenders used to insist upon it and borrowers didn’t mind. If it’s mandatory it’s got to be a good idea hasn’t it?
Buildings insurance is mandatory but people really don’t mind paying for it. Most people add contents insurance too even though it isn’t a legal requirement. Car insurance is a legal requirement but fully comprehensive insurance isn’t, yet most people happily pay extra for fully comp.
So, do you need life insurance?
If you are single with no dependents then no, you probably don’t need life insurance. Critical illness insurance or income protection is a far better idea. As you’re own your own you need to make sure that you can pay your mortgage and bills no matter what kind of accident or illness might happen.
If you are in a relationship or have a family then life insurance is a good idea but not mandatory. You have to ask yourself, if I died could my partner afford to pay the mortgage on his/her salary? Don’t just assume that the surviving partner will sell the property and move on. Right now it’s difficult to sell a property and it can take a long time to find a buyer and besides, if you’d just lost a partner would you really want the stress of having to move as well? Where would the surviving partner move to and would they be able to afford a new mortgage?
If you have children ask yourself what the financial impact of your death would be? Would your partner be able to pay the monthly bills, the mortgage and look after the children?
If you find that the answer to these questions is that yes, you need life insurance, don’t delay it any more than you have done already. Get a quote. Life insurance is the cheapest kind of term insurance available so it will probably cost you only pennies per day.
Wed, May 20, 2009
Life Insurance