life assurance review

jonnyb1978

My wife has been pay life assurance, currently £20 a month. Starting the policy around 20 years ago. A review has come through the post and im questioning whether its worth it.

Her salary is double what is on the review and the the cover end date is in 2027. My wife will be 50. Hardly old age. The main benefit it offers is a £30000 lump sum on death to pay mortgage. At present the mortgage is more than this.

If she dies her pension will pay four times her salary. That will cover the mortgage.

As its me who pays the mortgage out of my wages im thinking the above is just dead money as it should be me who should have the insurance...my pension also pays four times my salary upon death which will cover the remaining mortgage four times over.

Is it worth carrying this on? Do we need some sort of policy on life assurance having our pension policies? Is it best just me having an unemployment benefit?

Thanks

dunstonh

Is it worth carrying this on?

Depends on whether you have a financial need for it or not. If your wife died, how much would you be financially worse off?

Do we need some sort of policy on life assurance having our pension policies?

With death in service, this suggests that the schemes are defined benefit (some money purchase schemes may offer bolted on life assurance but these are not that common). A defined benefit scheme includes death in service to go someway to reduce the impact of income in the short term and reduced pension benefits that you may have been relying on. it isnt really geared for providing coverage for mortgages. It can be used for that purpose but it would mean that it may not provide the sort of coverage that it is really designed for and leave a shortfall there.

That said, if you have sufficient savings & investments and both of you can survive financially if the other dies then you dont need life assurance. If you either of you would suffer financially, then you do.