Choosing life insurance for a growing family

Life insurance offers an excellent way to help ensure your family remains financially secure after you pass away. Unfortunately, many households in the UK still don’t seem to realise how important this cover is for their young families. For others though, the challenge is in choosing the most suitable option from the many policies available in the market today.

If you are concerned about your growing family’s future, one of the best decisions you can make is to secure a life insurance plan today. The good news is, you don’t have to break the bank to get cover in place.

Here, we share eight practical tips for choosing a suitable life insurance policy that suits your young family.

Start early, save more

Let’s face it; death is inevitable, and planning for it is something that each of us should be encouraged to do regardless of age. An excellent way to prepare for it is to set up a life insurance policy, especially at a younger age when your premiums are likely to be cheaper.

It’s therefore unfortunate to see a lot of young people overlooking this fact and assuming they’re too young to need a life insurance policy. Don’t be that person. Contact a reputable broker like Caspian Insurance today and begin your journey to safeguarding the financial future of your loved ones.

Determine your coverage needs

There are two main types of Life Insurance; Term and Whole of Life. Term Life Insurance provides coverage for a specific period, and if you pass away within that period, the policy pays out (subject to a claims process). Whole of Life lasts for as long as you keep paying the premiums. Factor in these two types when determining what’s best for you and your growing family.

Compare rates across companies

You have to remain open-minded when searching for a life insurance policy. Different providers have varying rates. And while the difference may seem insignificant at first, it could make a significant difference in terms of monthly premium payments in the long-run.

Besides, it’s important to understand that there will always be differences in price quotes depending on the type of policy you’re looking to buy. For example, a term policy of £20,000 won’t be the same as a Whole of Life policy for the same amount.

Things to consider

For the sake of certainty about your family’s financial future, you may want to consider companies that have been in business for a long time. This may seem unfair to the industry entrants, but it’s the sad reality – experience matters a lot here.

Another key aspect to look at is the provider’s claims settlement ratio. This is the number of insurance claims that an insurer has settled in a year. The higher the ratio, the better the chance you will be compensated.

Write your policy into trust

Setting your policy up under trust allows you to name those who you wish to benefit from any payout. This is also a way of helping mitigate inheritance tax.

Customer support

The quality of customer service matters a lot in the insurance industry. You want to deal with a provider with an efficient care team that handles your queries and complaints promptly. If you cannot gauge the quality yourself of the support, use comparison sites to get an idea of what to expect.

Bundle several policies with one provider

Where possible, use your life insurer provider for your other insurance needs. In doing so an insurer may offer you a multi-product discount on your monthly premiums.

Accelerated death benefits

By accelerated death benefits, it means your insurer allows you to receive your cover amount on diagnosis of a terminal illness, meaning you have 12 months or less to live. It is always advisable to check your chosen policy’s terms and conditions for guidance on this.

Conclusion

A life insurance policy is an affordable way to financially support your family or loved ones in the event of your passing. However, before you take out a policy, it’s vital to look into the factors we’ve explained here to ensure you’re getting the most suitable policy. As highlighted earlier, we strongly urge you to take a life insurance policy out whilst you are still young as this will generally mean that your premiums will be cheaper.