Ensuring that your mortgage and other debts are repaid with a life cover policy provides peace of mind, as does leaving something to your spouse or dependants to ensure they are financially comfortable in the event of your death.
What is life cover?
Life insurance - often called life assurance - is a policy which is designed to pay out a lump sum if the policyholder dies during the term of the policy. The money can be used to meet funeral expenses, to repay debts or simply to provide a lump sum to your family.
Generally when you buy life insurance UK policies will run for a fixed term, this tends to be a set number of years.
You decide on the term of the policy when you get your life assurance quote and this specifies how long the policy will run for. For example, a 20 year policy would only pay out if you died within the 20 years.
Whole life insurance policies are available and these run until your passing, and consequently come at a significant cost.
What to look for when you search for the best life insurance cover
There are dozens of cheap life insurance companies offering cover in the UK. So, it's certainly worth comparing providers before you buy in order to get the cheapest life insurance quote.
When looking for the best life insurance cover, take the following into account:
- Whether you want level term life insurance or a decreasing life assurance quote
- The term of the policy
- Any minimum or maximum age limits
There are two main types of term life cover. Level term assurance is a fixed amount of cover that will pay out a specified amount if you die within the term of the policy.
A decreasing term assurance (sometimes called 'mortgage term assurance') provides cover on a decreasing basis. This means that if you were to die during the later years of the policy it would pay a lower amount than it did in the early years.
When you are searching for the cheapest life insurance quote it's also important to choose the right term for your cover. Shorter terms generally come with lower premiums but it's important to ensure that you're not suddenly left unprotected if your policy expires.
You should also research any maximum or minimum age limits for your life cover before you buy as this will dictate whether you're eligible for a policy.
As life cover is a simple product, the cheapest life insurance quote for the amount of cover and the term you require is normally the preferred option.
That said, you will need to check the terms and conditions to make sure that your life insurance policy will pay out in the event of your death.