Life Insurance for your Family

A financial safety net for your loved ones should the unthinkable happen to you.

Do you have dependants – such as school age children, a partner who relies on your income or a family living in a house with a mortgage that you pay? Life Insurance can provide for them if you die. Such a loss can have a massive impact on your remaining family and their quality of life. The last thing you want is for them to be left with a financial burden.

Every day, more than 100 children are bereaved of a parent in the UK.

Life Insurance for your family provides peace of mind with financial security and helps ensure that:

  • The quality of life that they’re used to can be maintained or even enhanced.
  • Bills, educational costs, childcare, mortgage/rent, debts etc. can all be paid for.
  • Unnecessary stress and worry is avoided at a difficult time.

If you already have Life Insurance to protect to your family, when was the last time you reviewed your policy? We could help to save you thousands of pounds.

Our friendly Advisers are available to answer your questions, provide expert advice and make recommendations – so please call us on 0800 988 36 37 – or get a quote.

 

Cost of Raising a Child

As any mum or dad will know, a bundle of joy also means a bundle of expenses.

QUESTION
How much would you estimate the cost of raising a child to the age of 21 to be?

ANSWER (click here)

The actual cost is £231,843!* Most parents massively underestimate the cost. Did you?

£10 per month is the approximate cost of this Life Cover for a 30 year-old non-smoker.

*LV= ‘Cost of Raising a Child 2016’ research.

Different types of Life Cover for my Family

The concept of Life Insurance is simple – if you pass away during the term of the policy then a sum of money is paid out. The exact reason for needing the cover may mean that a particular type of Life Insurance is better suited to your circumstances. We will advise the best type of cover for you – but here’s an overview:

Level Cover

Provides a lump-sum pay out, where the amount of cover stays the same throughout the policy. You can also include an option to have the amount of cover increase each year to keep pace with inflation (this is known as either ‘Indexation’ or ‘Increasing Cover’).

Family Income Benefit

The cover is paid out as a series of monthly or annual installments, rather than a lump sum. It can accurately replace the income lost as a result of death of a wage earner and the next of kin don’t have to worry about how to invest a large lump sum of cash. This type of policy is typically cheaper than Level Cover. Your Adviser will explain the pros and cons of each type of cover.

Whole of Life Cover

This policy does not have an end date. Provided you keep paying the premiums the cover will pay out a fixed amount of cover upon death, whenever that may be. The main benefits of this type of cover are to ensure funeral costs are covered, leave a financial ‘nest-egg’ for loved ones or to provision for an Inheritance Tax (IHT) bill. Learn more about Funeral and Inheritance Tax Planning.

Decreasing Cover

This type isn’t particularly relevant to providing cover for your family. If you are looking to protect a mortgage which is on a repayment basis, then we would recommend this type of policy. The amount of cover reduces each year, typically in line with the outstanding balance of the mortgage. Learn more about Life Insurance for your Mortgage.

Beware of buying Life Insurance from your Bank or Mortgage Broker!

You can purchase Life Insurance virtually anywhere now, however, the cost for identical cover can vary dramatically. A pint of milk doesn’t cost the same in every shop and insurance isn’t any different either!

When your bank or mortgage adviser has sorted out your mortgage, it’s likely that they’ll use the ‘would you like fries with that’ approach to tag on some insurance. Whilst it may seem logical and convenient to use the same person who’s helping you raise finance, you are unknowingly restricting your options and could end up paying around 50% more than you need to – which can total thousands of pounds over the term of a policy.

Read this article in The Telegraph which explains more.

Here at Vita we can source discounted premiums from all insurers in the UK and are experts in this field.

Ensure the money is paid quickly to your named beneficiaries with our FREE Trust Service

Each insurer gives you the option to write your Life Insurance policy ‘in Trust’. This is a method which allows you, and nominated others, to control what happens to the policy proceeds after your death.

  • There is no cost for setting up a Trust – we will draft the form and assist you to complete it.
  • Ensures that the policy proceeds are paid directly to the people that you nominate.
  • Avoid a potential Inheritance Tax bill – Policy proceeds are not typically liable to be taxed.
  • Policy proceeds are paid at the earliest opportunity and not held up in Probate. (i.e. the proceeds do not form part of your Estate. They are kept separate).

Include Critical Illness Cover

Considering whether to include Critical Illness Cover is one of the most important financial decisions you will ever make for yourself and your family. Please take 5 minutes to read our dedicated page.

Critical illness Cover aims to give you peace of mind, ensuring you can receive a tax-free lump sum if you are diagnosed with one of the listed critical illness conditions under the policy.

Worryingly, a serious illness, such as cancer, stroke or heart attack, affects one-in-four women and one-in-five men before they reach retirement age. The latest statistics from Cancer Research UK show that 1 in 2 people in the UK born after 1960 will be diagnosed with some form of cancer during their lifetime.

If you, or those who depend on you, would face financial difficulties if you became critically ill you should seriously consider taking out Critical Illness Cover. When you’re critically ill, the last thing you need is any financial worry like the fear of losing your home because you can’t pay your mortgage or provide for you or your family.

View our dedicated Critical Illness Cover page to learn more.

Frequently Asked Questions

What is Life Insurance and how does it work?

Life Insurance pays out money to your loved ones if you die.  It is designed to help protect your family by ensuring they don’t suffer financially. Your Adviser will work with you to recommend a suitable amount of cover and period of cover (the term) to meet your specific needs.

How much will it cost?

Price will vary depending on your age, your health, your job, the amount of cover you want and maybe even your hobbies. This is why price comparison site quotes are often meaningless as they won’t account for your specific individual circumstances.

We will provide you with accurate premiums from the outset. Nobody likes to see a price and then be told it’s not available to them.

The Life Cover policy you buy is there to protect your family – not anyone else’s – so it’s worth finding a policy that will exactly suit your needs.

Do I get any money back if I don’t die?

No. For the period you are insured you continue to pay a relatively low premium in relation to the amount of cover. If you haven’t needed to claim then this is ideal – you’ve had peace of mind the entire time and you’ve not passed away prematurely.

It’s no different to car insurance – which won’t pay out if you don’t have an accident – or pet insurance – which doesn’t pay out if your pet stays well.

How much cover should I have? And for how long?

We don’t do off-the-shelf. We genuinely care about getting the right cover for you. Your circumstances may be similar to someone else’s, but never identical. Our consultative approach means that you’ll feel listened to and understood. Also, you’ll get a solution that’s tailored to your personal needs.

I have (or have had) health issues – can I still get Life Cover?

Our Advisers have an excellent understanding of all health issues. We regularly help to arrange cover for people with past or current health issues and use our knowledge to search the market and speak to the insurers’ underwriters to ensure that you get the best deal. Having helped thousands of customers so far, we’ve come across virtually every condition imaginable.

If I get an illness will my premiums change?

No. Once your policy has started you don’t need to tell the insurer if your health or lifestyle changes. The insurer will assess the risk you pose at the point of application. After the policy has started, any changes to your health or lifestyle thereafter don’t impact your cover.  

If your health improves (e.g. you stop smoking or a condition becomes less severe) then it is worth getting in touch to see if we can save you money with a new policy. The same applies if you were to cease doing certain hazardous activities that caused the premium to be slightly higher in the first place.

Will my family have to pay tax on any life insurance proceeds?

The money from the insurance pay out is free from income and capital gains tax, but potentially liable for inheritance tax (IHT). However, your Adviser will help you to write the policy ‘in Trust’ (free of charge) to avoid paying IHT. This also ensures that the money goes directly to your nominated beneficiaries and won’t form part of your estate when you die – which means your family won’t have to suffer delays waiting for Probate. 

Can I make changes to my policy?

Insurers understand that your circumstances may change in the future. So that your policy can adapt with your needs, most insurers provide different options that help – such as changing the amount of cover, the policy length, switching a joint policy into a single one, etc. Your Vita Adviser is at your service for the duration of your policy – so if your circumstances change, all you need to do is get in touch and let us know.

Can I cancel my policy if I no longer need it?

Yes. Although it is worth considering that should you need to re-apply for cover at a later date, the same cover is likely to cost more as you will be older. Also, insurers will reassess your Health & Lifestyle at the time, which means you could be charged more if your health has deteriorated, or worst case – may not be able to get any cover at all.

The insurer won’t charge you any cancellation fees and, unlike some competitors, we won’t charge you any fees either.

Our friendly Advisers are available to answer your questions, provide expert advice and make recommendations – so please call us on 0800 988 36 37 – or you can request a call back.