What Does Life Insurance For Women Cover?

Life insurance for women covers what it does for men – it is a way of ensuring that in the event of your death, you will leave your family or dependants with a lump sum that will allow them to continue with a standard of living that they enjoyed while you were still here.

As more women than ever are now the main breadwinners in the family, making sure you have life cover is essential, because if you were to die unexpectedly or are taken seriously ill, your income – the main source of income – would cease. This would cause significant problems for your loved ones, who would potentially find themselves out of the family home if they could no longer afford to meet the mortgage payments.

Despite this, many women still fail to get life cover to protect their family, in some cases it is because they are staying at home to care for their family and don’t see their role at home as having any monetary value. But what many stay-at-home mums forget is that the role they have is worth a lot of money, even if they are not specifically getting paid for doing the work.

It could impact on the household finances further as the main breadwinner could find themselves taking time off work to look after the children, which means that not only would your family lose the value of the work of one parent, the second parent may also see their income reduced as they need to reduce the hours they are working.

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What types of life insurance is there for women

Both men and women can get term assurance and whole of life cover. Term assurance is a policy which is in force for a specific period of time and is usually sold alongside a mortgage.

Lenders will generally want a way of getting their money back if you die, and that is why one of the conditions is that you have life cover alongside the mortgage. Term assurance is perfect for this as it can be in force for as long as the mortgage term. So often, these policies are in place for 25 years – if you die within this time, you will get a payout. But if you live longer than the policy is in place, it will simply expire and you will no longer get a payout if you die.

There are two types of term assurance: level term and decreasing term. Level term means the payout that is made if you make a claim within the period the policy is in force stays the same throughout the entire policy term.

Decreasing term means the payout will reduce over the term of the policy, usually this is in line with how the mortgage it is written alongside is reducing over time. The premiums should also fall as the payout falls.

Can I take out life insurance during pregnancy

Life insurance during pregnancy  will be no different to a policy you would get without being pregnant. But you may need to consider some of your answers to the questions that the insurer bases the premium calculations on.

Your weight, for example, will be higher than normal if you are pregnant. So you should give the weight that you were immediately before you became pregnant.

The amount of alcohol you drink and whether you smoke or not may also be different – you would probably not be doing either while you are pregnant – so you need to take that into consideration too. How you deal with it will depend on the questions you are asked, as some policies will be specific about whether you have recently been advised ‘for medical reasons’ to give up alcohol. This will allow you to explain the reason.

If this is not an option, you should speak to your insurer directly to make sure you give all of the information that is needed. Not doing so could result in your policy being deemed invalid.

Once you have children, you may also want to consider taking out a joint life policy so that if you or your partner or spouse dies, your children will be taken care of. Joint policies are usually cheaper than buying two separate policies, and you can have joint life first death or, more rarely, joint life second death.

With the former, the payment will be made when the first of the two people named on the policy dies. The latter will only payout when the second person named on the policy dies, which is why it is rarer.

The difference in premiums for men and women

Historically women have paid less for life insurance than men because statistically they are likely to live longer and therefore have more time to pay the premiums for an equivalent payout.

However, from December 2012, a ruling from the European Court of Justice will be enforced which will mean it is no longer legal for insurers to base premium costs solely on gender differences.

Will the cost of life insurance for women rise?

As yet, it is not clear whether prices for women will rise, or they will fall for men, or they will meet somewhere  in the middle.

But if you are a woman and you had a policy in place before December 2012 with fixed premiums, you should not see any premium increases as a result of the change in the law.

How to reduce the cost of women’s life insurance

The measures you can take as a woman are the same as those taken by a man. Changing some of the risk factors that insurers base their premium calculations on will help to cut costs.

For example, if you are obese and you lose weight, your premiums should fall. Similarly if you drink less alcohol, or stop smoking and lead a healthier lifestyle, these will all be looked favourably on by your insurer. Alcohol consumption, weight and smoking all increase the amount you pay, so changing any or all of these will cut costs.