You might think that you know well enough the basic principles of life insurance - for example, that it is designed to help financially protect families by providing a one-off tax-free lump sum payment in the event of the policyholder’s death.
But are you currently dismissing the thought of purchasing life insurance, due to certain perceptions about this product that might be little more than myths?
If so, it may be a good idea for us to draw your attention to some of the following easily overlooked truths about life insurance.
Life insurance can be easily combined with other forms of protection cover
You don’t necessarily have to have life insurance instead of an alternative type of protection insurance, such as income protection insurance or critical illness cover. Combined policies are available that could help cover all the key bases at a reasonable cost.
Life insurance doesn’t have to end once you have finished paying off your mortgage
Although a lot of people are motivated to purchase a life insurance policy because they are in the process of paying off a mortgage, it is important to acknowledge that there isn’t a direct link between a life insurance policy and a mortgage. So, you can set up your own life insurance policy so that it remains valid even after your mortgage has been repaid.
After all, if you were to pass away, it might not be only mortgage payments that your surviving family would have to pay for in your absence. Life insurance can therefore serve as a much broader and longer-lasting form of financial protection than that.
Life insurance isn’t a legal requirement for a mortgage
If you are only just in the process of arranging a mortgage right now, you might easily overlook that there isn’t actually any law requiring you to take out life insurance in order to secure a mortgage.
However, if you do commit to such a large debt as a mortgage, it could be a very wise idea to purchase life insurance alongside it anyway. The fact is, you can never be sure when the worst might happen, and the payout from a life insurance policy could be invaluable for your family if you pass away and they are left with mortgage debt they still need to clear.
A pre-existing medical condition won’t necessarily prevent you from getting life insurance
You might have imagined that if you have a pre-existing health condition such as a heart condition or diabetes, it wouldn’t even be worth enquiring about life insurance.
However, if this is the case for you, it might not be impossible for you to get approved for a reasonably priced life insurance policy. Much will depend on the severity of your health condition and the outcome of your medical assessment, so if you are in any doubt, please don’t hesitate to give our team a call on 0800 316 6917.
It’s possible to have multiple life insurance policies at the same time
Again, there is no rule against this, and some people do have several life insurance policies simultaneously.
However, if this is something you’re considering because you already have a life insurance policy that doesn’t represent the perfect match to your requirements, it might be worth looking into whether you can have your existing policy adapted to those needs. Changes that might be possible range from changing the term and the amount of cover, to changing how often you pay premiums on your policy.
There you go - five things that you might not have realised about life insurance, that could inform your decision-making. If you would appreciate the help and guidance that our UK advisers can provide, please don’t hesitate to call our free, no-obligation advice and quotation line today, on 0800 316 6917. You might just end up walking away with the ideal life insurance policy for your requirements.