Life assurance may not be an exciting way to spend your money, but if you have a family and/or a mortgage it is a crucial component of your financial planning.  

Not everyone needs life cover. It is specifically designed to support your dependants if you die, so if you do not have children or a partner who relies on you financially then there may be little reason to spend money on premiums.  Parental responsibility is the spur for most people to think about additional life cover, but every couple with a mortgage should also have life assurance in place to help pay off the debt in the event of either partner’s death. Otherwise the property may have to be sold because the survivor cannot manage the debt alone.  So what do you need to consider when you buy life assurance?  

Term assurance  

The simplest and most common, term assurance, provides a sum insured which remains the same throughout the term. It has no investment value; it simply pays out if you die while the policy is still valid. There is no cash in value or payout if you survive the term, or if you cancel the policy before it expires. Term assurance is a cheap way of buying protection, because the life company may not have to make any payout at all and can therefore fix premiums to reflect that possibility.  The term can be fixed to coincide with a specific date such as the end of your mortgage. your expected retirement or until any children are no longer dependent. During that time you pay fixed regular premiums. These are calculated on the basis of your age at the start of the policy (you pay less, the younger you are), health, gender (women pay lower premiums because they have a longer life expectancy) occupation, whether or not you smoke, and the term of the policy.  

Mortgage protection 

The best choice if you are looking at mortgage protection depends on your mortgage arrangement: for a repayment mortgage, where the outstanding debt is gradually reduced over the years, you may be better served by a decreasing term policy. With this arrangement, the sum insured is gradually reduced roughly in line with the diminishing debt.

For insurance business we arrange policies exclusively from Legal & General

YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON A MORTGAGE OR ANY OTHER DEBT SECURED ON IT.