Why you should think again if you’ve said ‘No’ to life insurance
"I don’t have any dependants"
Life insurance provides money for those you leave behind. It can settle debts such as the mortgage and pay for their household bills and living costs.
So if no-one is financial dependant on you, why would you need it?
What if your situation were to change? If you’re planning to start a family at some point, or even if you think it might be a possibility, then buying life insurance sooner rather than later could prove worthwhile.
That’s because age and health are two of the main factors determining how big your premium will be. The older you are when you buy, the more the insurance will cost. So when you’re thinking about your future, consider whether it makes sense to get insurance now at a more affordable price.
"I can’t afford it"
The price you pay for life insurance depends on a range of factors such as your age, health, lifestyle, how much cover you want and how long you want the policy to last.
According to our data, the average monthly cost of life insurance for someone in their 30s with a £200,000 insured amount over 20 years is £9.44.* Given the importance of the protection provided, this amount could well be worth finding if possible.
*The average cost above is based on non-smoking MoneySuperMarket customers buying single life insurance only (without critical illness cover), for a level term policy with a life cover amount between £150,000 and £200,000 for 10 – 20 years, from July 2018 to July 2019
"I don’t understand how it works"
Many people find buying financial products off-putting. There can be loads of jargon, and it’s not always easy to know how to get the right deal at the right price.
With something as important as life insurance, you need to be confident that you’ve got the right sort and the right amount of cover. We’ve got plenty of guides on our site to help you get to grips with the topic, and you can also talk to our partner broker, Life Search, for advice and support.
Call their dedicated MoneySuperMarket team free on 0800 170 1963.
"I’d rather not think about it"
Thinking about your own death is difficult, to say the least. But if you have dependants, you need to confront the reality that you might die before they are financially self-sufficient.
If you have life insurance to cover you against the risk of dying prematurely in an accident, through illness or any other cause, then at least you’ve taken care of the financial impact of your early death.
"I’m already insured through my job"
This is a solid-sounding reason – if you have work-related life insurance (often referred to as a ‘death in service’ benefit), why do you need to buy another policy?
The reason is that the cover provided by your work policy – it’s usually set at four times your annual salary – may not be enough for your needs.
If you earn around the national average wage – say, £30,000 a year – then your work policy would pay out £120,000 if it worked on the ‘four times salary’ basis. That’s a lot of money, but would it be enough to clear your mortgage and provide funds to support your dependants over the coming years?
To help you work out how much cover you need, we’re created a life insurance calculator. You can then think about getting another policy to top-up what you have through work.
"I’m young, fit and healthy – I’m not dying any time soon"
It’s easy to understand why someone in the prime of life might not give much thought to dying. But who knows what the future holds for any of us? From a traffic accident to the unexpected onset of a fatal illness, we are all vulnerable to some extent.
What’s important is to imagine the impact of our early death on those who depend on us. Leaving behind unpaid debts and failing to provide for loved ones is a situation to be avoided at all costs.