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Do we need life insurance?
Moneybox
Posts: 194 Forumite
Thanks for any advice you can give;
Is there a guide anywhere to help establish what cover is advised?
We are married, home owner, no mortgage. no debt.
Mid 40s. 2 Children (youngest 6).
Wifes Salery is approx. twice mine. We both have a death in service payment with our pensions.
How do we begin working out what cover we require? Our concern is the well being of our children in the event of terminal illness or death.
Wifes income is greater but then my in service death payment is smaller. Do we buy equal cover or weighted one way or the other?
Thankyou.
Is there a guide anywhere to help establish what cover is advised?
We are married, home owner, no mortgage. no debt.
Mid 40s. 2 Children (youngest 6).
Wifes Salery is approx. twice mine. We both have a death in service payment with our pensions.
How do we begin working out what cover we require? Our concern is the well being of our children in the event of terminal illness or death.
Wifes income is greater but then my in service death payment is smaller. Do we buy equal cover or weighted one way or the other?
Thankyou.
0
Comments
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There are various types of insurance you could look at:
Term assurance. You could do this on a level/decreasing or increasing basis to provide a lump sum in the event of death. You could start low and do it increasing with inflation. You could start high and it reduce as the children get older and the amount of benefit needed reduces.
You can do family income benefit, this pays a monthly amount.
You might also want to consider income protection/phi. Yes there is no mortgage but there are still bills to pay and if you are alive but unable to work, you are still costing money.I am a Mortgage AdviserYou should note that this site doesn't check my status as a mortgage adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.0 -
I think you need to think through the options if the very worst of various eventualities happened:
a) you died or became incapacitated
b) your wife ditto
c) both of you died, eg in an accident.
In a or b you would presumably need insurance to cover the lost income, up to the survivor's pension age?
In c you would need agreed guardians for the children, and income to reimburse them the burden of supporting and educating your children.
Many people have reciprocal guardianship agreements for this eventuality, with relatives or friends.
Some outcomes may simply be unaffordable to insure against, in which case you have assess their likelihood and just accept the risk.This is a system account and does not represent a real person. To contact the Forum Team email forumteam@moneysavingexpert.com0
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