Is life insurance worth it with no partner and no kids but still paying a mortgage?

LearnerMan1

Hi,
Please could I get some advice.
I pay £30 per month for a managed life policy with a decreasing benefit type this is with the Exeter. I currently have no kids and no partner although I have a mortgage. To be honest I feel like I was talked getting the policy by my mortgage broker back last year when I got my mortgage. We tried to get critical injury insurance but I was not successful so settled  for ordinary life insurance. But I'm starting to resent it now to be honest. I think now if anything happened to me I could leave a will and my hone could be sold and the remainder could go to my siblings. I really do think the £30 per month would be a lot better in my pocket!

Appreciate some advice.
Thank you 

cymruchris

What do you want to happen to your estate when you pass away? 

Is there a chance in the future that there might be a partner?

Are there good friends you'd like to see your estate passed to?

With no insurance - your place will be sold - the mortgage repaid from the proceeds with whatever was left distributed as you so wished. 

I'm in a similar situation that I don't have any immediate family - I do have a life insurance policy - but also wonder why I bother having it. I'm likely to leave everything to a charity. My small monthly fee might enable them to get a bigger payout, something I could never do from my own savings. That's about the only reason why I'm keeping it in place for now. 

Petriix

I don't see how life insurance gives you any value so I would ditch it. I'm paying about £9 per month for a flat £200k cover until the age of 65. It gives me peace of mind as I have a partner and two kids.

pjcox2005

I wouldn't have it either if i've got no dependents, you're not insuring a real risk unless someone needs the support/money on your death.

Mickey666

Life insurance is of no practical value to the insured (well, except peace of mind perhaps).  It is primarily for the benefit of their dependants.  Thus, no dependents, no need for life insurance.

gozaimasu

Agreed, cancel the policy. My broker also tried to push life insurance on me and get me to sign a document to say I'd refused it. If I die they can sell my property, boo hoo.

es5595

Critical illness cover makes sense, especially since if it’s required, you’ll be the one using it. Life insurance makes no sense at all; you’ll be dead!
I’m in a similar situation to yourself. I had it once, because I saved more than it cost in gym membership discounts, free Starbucks and cinema tickets. Otherwise, it’s pointless. That’s £360 a year, quite a significant sum! 

I seem to often get the hard-sell on life insurance and my response is always, ah cool, how could I spend it? When they come out with some line about paying off mortgage, funeral expenses etc I respond “ah, but I’ll be dead?!” and repeat ad nauseaum. 

If someone wants a funeral/party for me, that’s their choice! I’ll be dead and really don’t care! There’s more than enough equity in the house for a few family/friends etc to get a few £££, why would I have less money now so they could have extra, when I’m dead?! It really is bizarre when you think about it!

LearnerMan1

Thanks for all you help guys. I am going to cancel it, at the end of the day if my situation changes I can always get set up again with it. However money better suited in my pocket. I've emailed my mortgage broker to tell him I'm cancelling it. So waiting for them to try to talk me round again (I'm sure they get a cut from the Insurance company) but I'll be sticking to my decision I think.

portoman

I've put a post elsewhere about this, but it concerns the same thing - most insurers seem to include CI with life insurance but I just want CI. My difficulty is the premium. I am 49 and even if I get CI to pay out £50,000 (which doesn't really cover anything), it is £70 a month, whereas to cover £150k is double that. I can't afford to pay that much each month, so what do other people do?

skint_chick

portoman said:

I've put a post elsewhere about this, but it concerns the same thing - most insurers seem to include CI with life insurance but I just want CI. My difficulty is the premium. I am 49 and even if I get CI to pay out £50,000 (which doesn't really cover anything), it is £70 a month, whereas to cover £150k is double that. I can't afford to pay that much each month, so what do other people do?

If you can't afford to cover your whole mortgage/your share of the mortgage then get what you can afford. Add up your basic monthly outgoings and see how long you can cover them for with a premium you're willing to pay - ie £2,000 a month for 2years might be £35 a month. Receiving a lump sum payout doesn't mean you have to pay a lump sum off the mortgage, you can use it towards monthly expenses until you're able to go back to work/put part of it towards monthly expenses minus any benefits you might be entitled to or part time income you're able to make if you need to reduce your working hours. Not all critical illnesses, particularly with modern treatments mean you can never work or earn money again so it's a balance between what you can afford/are willing to pay and the cover you can get. Something is always going to be better than nothing, even to give you six months breathing space if you were to get ill. 

Alternative is income protection policy that pays out a monthly sum after your employment benefits run out - ie if you get six months full sick pay the benefit can start then - the longer you can defer the payment and the lower you need the monthly payout to be the cheaper the premium - and it doesn't just cover critical illness, it would cover accidents and other illnesses too. Worth discussing your options with a financial advisor and doing your research into what would work for you based on your income, lifestyle, and savings.

thegentleway

Agree that with no dependants you don’t need life insurance. Critical illness cover only pays out fixed sums for certain illnesses. It doesn’t cover everything. I think what you’re looking for is income protection insurance.