The old saying advises us that preparation is the key to success, and this is particularly true after we start our families. Suddenly, it’s no longer just about us and our other half – we have responsibilities when it comes to our children, and we all strive to do our best for them.
While we shudder to think about it, there will likely come a day when we won’t be there for our children, to provide a shoulder to cry on or comfort them when they are sad.
When our children are at their most vulnerable, and we can no longer hold them in our arms, it will make all the difference to have a life insurance plan to fall back on – because, in the midst of their grief, the last thing they need to worry about is money.
Are you among the 12 percent of UK mums who still doesn’t have a life insurance policy in place to protect their family if the worst happened? Are you overwhelmed at the mere thought of it? Well, fear not!
Here are the basics you need to know, to make the process so much easier.
1. So, what exactly is life insurance?
Life insurance is a form of financial protection taken out by a policy holder, set to activate and pay a pre-selected beneficiary in the event of that policy holder’s death. The policy holder will typically take out a protection or investment plan, in exchange for a premium.
2. Why do I need it?
To protect your family, plain and simple. Just like opening a bank account and building up savings for your child’s future, taking out a life insurance policy is one of the most responsible ways to prepare for the worst - and the unexpected.
3. OK, so where do I begin?
Taking out life insurance is important, but it shouldn’t be difficult. The best way to start is by making note of exactly what you are looking for, and then talking to a dedicated customer care representative from an insurance company.
Ring around, and get reps to explain in easy-to-understand terms what they are offering. Have a pen and paper, and make notes; or ask them to send out some literature in the post/via email.
Make a decision, either by yourself or with your partner, on which broker will best serve your needs.
4. What do I need to take out a life insurance policy?
You will need certain documents in order to take out a life insurance policy. While a broker will be able to tell you exactly what you need, it will likely involve: contact information, your Social Security number, your driver’s licence number, your medical history, and information for your medical and emergency contacts.
5. Can I do it online?
Many companies have a website with a function allowing you to generate a quote online.
6. What should I be asking my broker?
While everyone’s policy will be different, depending on their needs, there are certain questions everyone should ask before they sign that dotted line.
Ensure you’re getting the terms you signed up for, and that every need is being catered to in your policy.
If in doubt over anything – whether it’s a phrase or a term – ASK!
Also important to query is:
- Will you get certain benefits from your plan
- How and when will it activate
- Will you need to change/upgrade, and when
- Will it change as you get older
- What happens if you can’t keep up with your premium payments
- Is there anything that will break the terms of your policy
The most important thing is to work out exactly what you need, and be clear about it. This is a really important step to take, so ask as many questions as you need.
