Life

Reasons to consider life insurance

Common life events that lead people to look at life insurance, including marriage, starting a family, buying a home, a high-risk job, funeral costs and debts.

Life insurance can be one of the most important financial decisions you make, yet many people don't have it. It is easy to put off when you are young and healthy, but cover is usually cheaper the earlier you take it out, and none of us knows what is round the corner.

It makes sense to do your homework before taking out a policy, so you know the cover is right for you. Here are some of the common reasons people start to think about it.

You're getting married

If you have recently got engaged or married and are sharing finances, life insurance can give you both peace of mind that the other would be supported if the worst happened. It can help make sure your partner keeps a similar standard of living.

There are two main types of policy. A single policy covers one person, while a joint policy covers two. A joint policy is often cheaper than two single policies, but it usually pays out only once. After a claim, the surviving partner would need to take out new cover. If your relationship ends, a joint policy may not be able to be split into two single policies, so it is worth making sure a joint policy suits you both before you commit.

You're starting a family

If you are planning to start a family, it is a natural time to look at life insurance. The costs of raising a child add up over many years, and cover taken out earlier is usually cheaper.

If your household is likely to go from two incomes to one, a financial safety net becomes even more important. Life insurance can help provide for your children if a parent dies, whether that is everyday living costs or money towards their future, such as further education.

You're buying a home

If you die before your mortgage is paid off, the repayments may fall to your partner. A life insurance payout could help them clear the mortgage or keep up the repayments. Some lenders may ask whether you have life cover in place when you take out a mortgage.

If you have dependants living with you, this matters even more. If the mortgage can't be paid, the lender may need to sell the home to recover the debt. You don't have to buy life insurance from your mortgage provider, so you are free to look at other options.

You work in a high-risk job

Insurers look at your occupation when assessing risk. People in dangerous jobs, such as some roles in construction, aviation or mining, are likely to pay higher premiums than someone who works at a desk. Cover may still be worth considering, as these are often the jobs where the need for protection is greatest.

Covering funeral costs

Even a basic funeral can cost several thousand pounds, and the bill often falls to family at a difficult time. Life cover can help with these costs so that your loved ones aren't left out of pocket.

Paying off debts

Debts don't simply disappear when you die. Creditors can be paid from your estate, which may leave less for your family, and anyone who signed a loan or mortgage jointly with you may become responsible for the whole repayment. Life insurance can help the people you leave behind deal with outstanding debts.

Finding life insurance with Kompare

If any of these apply to you, you can find out more on our life insurance page. You fill in a short form and a broker from our panel contacts you to talk through quotes. See how we work, or contact us with any questions.