21 Sep 2018
Why is Life Insurance Important?
Life insurance probably isn’t something you think of until you reach your older years, but, here’s why you should think about it sooner rather than later.
What’s this? A blog not about mortgages? What’s happened to us? Well, for those of you that are shocked –remain calm.
In all seriousness, it's really important to take out life insurance, especially after buying a house. There are a few different types of life protection, varying from lump sum payments to a stable monthly income, but no matter what policy you opt for, it’s there to make sure that your family is secure and your mortgage can be paid should the worst happen to you.
In this blog, we're going to focus on life assurance policies (a lump sum payment).
So, if you’re not convinced that life assurance is important, then keep your eyes glued to the screen! We’re here to tell you why you most definitely should take out life insurance after securing your mortgage and new home.
What is life assurance?
Should the worst happen to you, a life assurance policy is a guarantee that after the passing of the insured, a pay-out will be made. Sometimes, life assurance can be paid out after a set period of time, but usually, it’s paid upon the insured person’s death. It’s a traumatic time losing someone, and it can be made worse when families and loved ones begin to struggle financially, but life assurance policies ensure that families are protected and secure, in the worst-case scenario. Mortgages Online always recommend taking out life insurance, to prepare for the worst.
Below, we’ve got 5 reasons life assurance is vital.
5 Reasons Life Assurance is Important
1) Managing Debts and Expenses
Should your death come unexpectedly, it can leave your family wondering how they’re going to manage financially. And, at a traumatic time, financial stress is the last thing those grieving need to worry about. So, when it comes to getting life assurance, it can help manage any debts or expenses that may be left to pay after your passing. Loan, car, credit card and mortgage repayments can be difficult to manage, which is why life assurance can help prepare to ensure that these debts and expenses don’t stack up and become unmanageable. It will ensure that your family isn’t left with unmanageable debts.
2) Financial Security
Another thing that life assurance offers is the promise of financial security for your family. If you have children or a spouse, you want to them to be financially secure. Like we said, debts and expenses can add up, but for a single parent grieving, managing the expenses of life can be difficult. So, life assurance provides a financial safety net for your family.
3) Inheritance
One thing that crosses everyone’s minds when thinking about their passing is ‘am I going to leave any assets behind for my family?’ When you’ve taken out a mortgage, you’ll have your house as an asset, but it won’t be your families until it’s paid off fully. And, especially when we’re younger, there may not be a lot of assets to leave behind. However, with life assurance, you can name beneficiaries who will receive the pay-out in the event of your death. Life assurance can help you leave something for your family, as inheritance, in the event of your passing.
4) Protection
Financial worry after death for a family is an unnecessary burden, piled on top of grieving. What life assurance does Is it makes sure that your family and loved ones have financial protection in the event of your passing. Losing income in a household can mean that your family will be stretched thin. Your life assurance pay-out, should the worst happen, can help your family maintain their standard of living, without worrying about finances or the future too much. It allows them time to grieve without worrying about finances.
5) Ease of Mind
Ultimately, no one knows when it’s our time. Without going the full doom and gloom; it could be in a week, a year, 50 years – nobody knows. Life assurance allows you to ensure that should you pass away, your family will be protected financially. You can rest a little easier knowing that should the worst happen, your family won’t struggle with their finances.
We promise next week’s blog will be cheerier…
