No one is immortal and so protecting your life against the day when your time comes is imperative if for nothing else but the peace of mind of knowing financial problems will not arise for the ones you leave behind. Considering term life insurance could be an option for anyone who wants to ensure that their loved ones will not be financial distress at an already stressful time.
Often the simplest way to cover your life is with term insurance. How it works is basically that you set the amount you wish to insure (which is known as the sum insured) and the number of years you wish to be protected for, and if you pass away during the policy term, your family benefit from a tax free cash amount.
You should note that with term life insurance that no payout is made is you are still alive when the policy reaches the end of its term.
Some people will take out the cover to run until they reach retirement age, when their mortgage will be paid off or when their children have completed their education and are not financially dependent on them. How long the term of the policy will be is down the individuals’ own needs and circumstances.
When calculating the sum insured, this will be based on the amount your loved ones would need in order to clear any outstanding debts or to replace your income, should you die. To give you an idea of how much life cover you may need, multiply your annual income by roughly 10. This amount may be the bare minimum amount that you need.
Where to buy the cover?
Using the internet can be a quick and easy way of finding life cover. Term life insurance can be found online with a website specialising in offering comparisons from various insurance providers and this is often the cheapest way to take out your policy. You can compare not only the cost of the insurance but also what the different policy features and benefits.
There are certain things you need to consider when looking for cheap life insurance cover, and that is how you can influence the premium. Firstly, by using a specialist broker, you can get access to a wide range of insurers, some of who may offer special web only deals. So, knowing where to get a cheap deal is the first influencing factor.
If you are a smoker then your policy will often cost you more. Therefore stop smoking for at least 12 months before applying for your cover and you could see a reduction in the cost when getting quotes.
The same can apply to those who enjoy drink, so cut down or stop.
If you are aged in the fifty plus age group then look for companies who offer plans tailored specifically for this age group. There are some low cost deals available and a specialist broker will search for the cheapest quotes on your behalf.
Of course, being fit and in the best of health is the way to obtain the biggest savings on your premiums for life cover. The more exercise you get and the nearer you are to your target weight then the healthier you will be and the less chance of you getting ill.
Do note that taking on a joint policy (ie for yourself and your partner) can often work out cheaper when you take them out together. However, the insurance will only pay out once.
There are many insurance companies out there so when taking out something as important as term life insurance it is essential to choose an ethical insurance provider that is not going to disappear overnight. Your broker will help you find the right one.
In summary, term life cover would allow the ones you leave behind to be able to meet financial commitments which you probably took care of, without them having to struggle or worry about where to get the money when bills arrive.
David Thomson is Chief Executive of BestDealInsurance (http://www.bestdealinsurance.co.uk) an independent specialist broker dedicated to providing their clients with the best deal on their home, motor and life insurance.
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