Do young people need life insurance?

There’s no single answer to this question, other than to say that it really does depend on you. There’s a number of factors that go into deciding when is the right time to buy life insurance cover, and here we’ll take a look at them.
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Frequently thought questions

We’ve put together some ‘frequently thought questions’ that we hope provide answers that will go a long way to helping you reach the answer based on your personal circumstances. 

Should I get life insurance when I’m young?

Just because you might be young, it doesn’t mean you don’t have financial commitments or responsibilities. The purpose of life insurance cover is to protect those you leave behind financially. So, if you have a mortgage that would need covering, or young children to consider, it’s worth thinking about life insurance cover.

What’s term insurance and whole life insurance?

A term life insurance policy runs for a certain number of years, as defined by the policy, whereas a whole life policy, as the name suggests, will cover you until you pass away. Although whole of life covers you until you pass away, this does typically make it more expensive in the short term, so some people may choose to opt for a term policy instead.

Many people choose a term policy because it coincides with their mortgage or taking their children through their school years. Because of this they don’t feel they need cover once these expenses are taken care of. But it’s a very personal decision and requires the balancing of the costs you’ll pay now and in the future, against the benefits if you were to pass away.

Can you get joint life insurance?

If you're in a relationship and considering life insurance, you have two options – a policy together or two separate policies. A joint policy is usually cheaper, but for good reason: it'll only pay out once when the first person passes away and then the policy ends. So the remaining person may need to take out an additional policy which may increase your monthly premium given that you would be older.  Also if the worst were to happen and you were both to pass away then your loved ones would only receive one pay out.  

How much life insurance cover should I get?

This depends entirely on your own personal circumstances. If you have financial commitments that you want to cover, you can do some simple calculations to work out how much you need. For example, if you want to cover your mortgage look at how much you have left to pay, you’ll want enough to cover your remaining repayments.

If you would like to leave an amount to cover child costs you could look at how many years you need to support your children multiplied by how much each year you think they may need.

Of course, you may also want to look beyond this to make sure your spouse/partner would still be supported financially in the future, so consider how much you would want to set aside for that as well.

Is life insurance cheaper when you’re younger?

Yes, our research suggests that it is. The cost of Life insurance is based on many factors such as your age, your health, whether you’re a smoker or not plus things like how much cover you want and how long you want it for. 

What other factors determine how much life insurance costs?

Age is just one component that goes into the calculation of life insurance premiums. Insurance providers may weigh different factors differently too which is why it’s worth shopping around. In general, the following other factors will apply:

What is critical illness life insurance?

For a slight increase in your premium, your life insurance could also pay out a lump sum if you are diagnosed with one of a number of specified critical illnesses. These vary by insurance provider so be sure to check which illnesses are covered.

Do I need life insurance if I have a death-in-service policy with my employer?

Yes you might want to add to this cover. A death in service policy will typically pay you a tax free lump sum at a rate agreed by your employer. This might range from 2 to 4 times your annual salary for example. However this cover only lasts for as long as you are employed by this employer and also might not be enough to cover your mortgage or other outgoings. So consider how much you need in your circumstances.

How can I compare life insurance?

Whatever age you are, it’s always worth comparing prices for life insurance cover to make sure you’re getting the best value for money. We’ve done the hard work for you in that respect and can compare the premiums of a number of life insurance providers. Remember though, it’s important not to compare on price alone, make sure you look carefully at the terms and conditions to make sure you’re getting the level of cover you need to give you peace of mind. Use our life insurance comparison service today to find the right policy for you.

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