Life Insurance
The vast majority of people live paycheck to paycheck. Have you considered the impact if you were no longer here and your pay check was to disappear overnight?
The impact of someone dying if they have a partner, children, or a business can be devastating for everyone involved.
How would your loved ones, or your business manage financially should you pass away prematurely?
Generally Life Insurance is taken out for two key reasons. The first is to protect the family home, and the second is to protect the family and ability to maintain the standard of living that you currently have.
Protecting your Mortgage and Family Home
If you have a mortgage and live with your partner or family, it’s prudent to ensure that this can be paid off in full should you pass away to relieve the financial burden for your surviving spouse and family in what would be a very difficult and stressful time.
The reality is, if you were to pass away without life insurance in place, your family may not be able to service the mortgage and household bills without your recurring monthly income.
This scenario may result in difficult choices having to be made, such as having to relocate to a different area, renting, or having to move back in with family. These are real life risks that need to be seriously considered.
A life insurance policy is often arranged to protect home owners and their families so that if either of you was to pass away, your mortgage would be paid off in full.
This will help ensure your family can continue to live in the same home without a mortgage to worry about, given that they have also lost your income for potentially many years to come.
Protecting your Family
In addition to protecting your mortgage, you also have the option of setting up a life insurance policy for a lump sum of your choosing to be paid to your family when you pass away. You can set the amount, and decide how long you would like the policy to protect you for. You also have the choice of index linking the amount of cover you have to help insure the level of cover increases each year in line with cost of living increases.
This can be used to help to alleviate the loss of your salary into the household for a period of time, and could help your family with various outgoings such as holidays, trips, school fees, or anything else linked to your standard of living that wouldn’t be realistically achievable if a monthly salary was no longer there.
You also have the option of increasing your cover to make sure that you are well protected, with the addition of various add-ons to your life insurance plan. Please get in touch with our expert who will be able to discuss the different areas of cover available, as well as the benefits of each option.
Death in Service Benefit
Death in service benefit can help to alleviate financial pressure in the event that you should pass away. Some employers offer this as part of their employee benefits scheme, and this usually provides a lump sum to your family to help make up for the loss of your income should you pass away during your employment with that company.
Should you receive a death in service benefit from your current employer, you should always give serious consideration if you are looking to change jobs, as a change of employer can result in you losing your Death in Service benefit.
Whilst there is no doubt that death in service benefit would provide much needed financial assistance, we would always advise clients to carefully plan for the long term, especially where dependents are involved, as a death in service benefit does not, and will not, replace a lost monthly salary. Our expert can work with you to identify areas of risk to ensure that you are well protected.
Tailoring your Life Insurance based on your needs
Life insurance is often less expensive than you think, and provides complete peace of mind for you, knowing that your family will not suffer any financial hardship should you pass away.
Policies can be adjusted as your life evolves. This could be in line with big life events such as getting married, having children, changing jobs, moving to a bigger property, or any other event where your financial situation changes.
At West End Protect, your life insurance policy will be correctly set up in trust, to prevent any delay in your policy paying out to your loved ones, in the event of your death.
Our specialist will guide you through this process and help you to navigate the complexities of this process.
Setting up a life insurance policy in trust essentially means that any sum that is paid out sits outside your estate for inheritance tax purposes, and is paid tax free to your loved ones.
If this is not done correctly, your life insurance plan could form part of your estate when you pass away. This could delay payment to your family when they need it the most, as it is likely that the proceeds would be subject to probate which can often take as long as 12 – 18 months.
This highlights the importance of seeking professional advice regards insurance and protection, as getting this wrong can have serious implications for your family. Please contact our specialist who will work with you to structure a plan to make sure your family are well protected should you pass away.
If you are a business owner, you can set up and pay for your life insurance policy directly through your business as an allowable business expense. This is covered in more detail on our Relevant Life Insurance page.
Putting our clients best interests at the heart of every decision, each and every time.
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