Does my mum need life insurance?

Johnjones7656

My Mum is 56, single, lives in a council property and is disabled with health issues.
Myself and my sister are both grown up, but she keeps going on about wanting to 'leave us something' when she passes. (We don't want anything FYI!)
Shes been looking into life insurance policies but I don't think she needs one?? Can anyone advise?
I'm worried the companies are going to try and sell her something that wont even pay out the way she thinks theyre going to when she dies.

LHW99

If she has no dependents and and no mortgage, then IMO she doesn't need life insurance.

Perhaps she could put some money in Premium Bonds from time to time. She could then either share any winnings with you and your sister as they come, or use them to buy more bonds which you and your sister may inherit in due course.

dunstonh

General rule of thumb... if anyone is worse off in the event of your death, then you may have a life assurance need.

McKneff

As long as she has enough money for a funeral she doent need life cover.

Johnjones7656

Thanks for your help guys! I did think she didn't need it but thought I'd ask around to make sure I was thinking along the right lines!

Owain_Moneysaver

McKneff wrote: »

As long as she has enough money for a funeral she doent need life cover.

She doesn't actually need that - if the relatives refuse to pay for the funeral the council will arrange it and try to recover the cost from any estate assets.

The "over 50" policies" are often not good value for money but can be if your mother expects to die earlier than average.

Mojisola

Johnjones7656 wrote: »

My Mum is 56, single, lives in a council property and is disabled with health issues.

Myself and my sister are both grown up, but she keeps going on about wanting to 'leave us something' when she passes.

Owain_Moneysaver wrote: »

She doesn't actually need that - if the relatives refuse to pay for the funeral the council will arrange it and try to recover the cost from any estate assets.

The "over 50" policies" are often not good value for money but can be if your mother expects to die earlier than average.

She doesn't need to have enough to cover a funeral but, as she's thinking along the lines of wanting to leave some money for her children, I doubt she'll be happy if they end up with a debt.

While a council or NHS arranged funeral is a simple and respectful ceremony, many families don't like going down that route and would rather get into debt in order to arrange the funeral.

Johnjones - is your Mum getting all the benefits that she's entitled to? Could she set a sum aside each month to put towards savings in her own name that would cover a funeral?

If she's determined to set up some kind of policy, have a list of suitable ones to show her.

As Owain says - for most people, the over-50 plans are a rip-off.

Chris_Pollard

I'd just counsel some caution for over-50's plans. It is easy to make sweeping statements that these products are a "rip off" or "not value for money". The products today have been significantly improved to overcome some of the issues - and the most publicised being people who have paid in more than they will ever get back. Many products now have an age beyond which the insured isn't required to pay premiums.

For a reasonably healthy adult over 50 this product does not represent great value as they would receive a far more competitive premium based on their health (which would be underwritten) as long as they opt for guaranteed premiums throughout life. However, if another reasonably healthy over 50 adult is attracted to the Over 50 product because of ease and simplicity - there are no health questions, no medicals etc - then this is purely a "convenience" choice, or a need for instant gratification (a trait less prevalent in us over 50's ). It is a case of "buyer beware".

Advisers will recommend Over50's plans for those clients who would be rejected by the fully underwritten products.

It is easy to generalise. There have been some problems with older generation Over 50's plans, but please don't assume "most" customers (well, their families) don't receive value, or that the plans are a "rip off".

dunstonh

I'd just counsel some caution for over-50's plans. It is easy to make sweeping statements that these products are a "rip off" or "not value for money". The products today have been significantly improved to overcome some of the issues - and the most publicised being people who have paid in more than they will ever get back. Many products now have an age beyond which the insured isn't required to pay premiums.

I position them as an option of last resort. They are not rip off plans as you say. However, they are bought by a lot of people who do not realise that significantly better plans exist that they would qualify for. For some people though, they are the best option. For most, they are not.

Chris_Pollard

Completely agree Dunstonh. The majority of over 50's are well enough to have "properly" underwritten plans. Hopefully the portfolio of Over50 plans insurers is more skewed towards those in poor health but clearly many will buy direct who'd be better off with other plans.

csgohan4

lets not forget the mother of OP is disabled and has health issues and may not pass underwriting or it may be very expensive if they wanted it