Life Assurance - Advice Welcome

Dave_Pulsar

Hi,
My wife has just given birth to our first child, which has made me realise we should have life assurance, in case the worst happens.
We are also looking at moving house soon, so I guess we need to look at a policy that will allow us to increase the sum payout to reflect the new/higher mortgage.

Is there anyone else in the same boat and which policies are the best for this instance?

Thanks,

dunstonh

We cannot give advice as it would breach forum and FSA rules. However, we can give some pointers.

The mortgage is one thing and family protection is another. This will usually mean you have two life policies and not one as the term requirements and amounts are not going to match. Also, some companies price better on decreasing term assurance then level term assurance (or Family Income Benefit if you need the budget option) or vice versa.

Your existing policy may include an option to increase the sum assured. Some policies have a childbirth and house purchase guaranteed insurability option and that could be worthwhile. However, if the policy is more than 3 years old, its unlikely as life assurance cost has dropped over that period. Although Critical illness terms, if you have CI, are not as good so you may find benefit of keeping it.

The best provider will depend on your circumstances. Its quite possible to have the best provider for one person come out worst for another.

If you are unmarried, you should look at placing the life cover in trust. Even if you are married, there can be benefits of doing it in trust to the child(ren) if your estate would be above the IHT threshold on second death.