Life insurance

Protecting your family and dependants

Today, let us begin with the introduction to Life Insurance.

We all know that life insurance is good and very useful, especially when we have to cover ourselves against the unfavourable events happening.

Life insurance is about providing some financial security for people who depend on you if you died. (So if you don't have a partner, spouse or civil partner, children, or other dependants, you may not need life cover.)

To make sure you buy the right amount of cover, with the right terms and conditions, you should consider getting some advice. The adviser assesses what your family would need, and shops around for the cover that suits you best.

Always answer questions as best you can and disclose any existing medical conditions when asked. If you don't give the full facts, you could invalidate your policy and the insurance company won't pay out.

There are two main types of life insurance: term insurance and whole-of-life insurance.

Term insurance (also called term assurance) pays out only if you die within a certain term, and whole-of-life insurance pays out whenever you die. Some whole-of-life policies also contain an investment element to them, but such investment-type policies cost a lot more than protection-only insurance.

If you want investments, consider the full range of products (not just life insurance) which might meet your circumstances and needs.

Tomorrow, in the next articles, let's discuss in detail about the term and whole life insurance!