Life can throw unexpected events and surprises at us when we are least expecting it, as we’ve witnessed with the coronavirus (COVID-19) pandemic outbreak. Without thinking, we insure our cars, homes and even mobile phones. So it goes without saying that you should also be insured for your full replacement value with life insurance. This would ensure loved ones and business are financially catered for in the event of your unexpected death.

If you would like to review your situation or discuss the options available, please contact us for further information.

Projecting ourselves into the future to see what‘s around the next bend

For many of us, projecting ourselves into the future to see what‘s around the next bend is not an easy thing to do. However, making sure that you have the correct type and level of life insurance in place will help you to financially protect them.

Life insurance provides a safety net. Ultimately, it offers reassurance that your family and business would be protected financially should the worst happen. We never know what life has in store for us, as we’ve seen in recent weeks with the outbreak of COVID-19, so it’s important to get the right life insurance policy. A good place to start is asking yourself three questions: What do I need to protect? How much cover do I need? How long will I need the cover for?

Supporting your family and business financially when you’re no longer there for them – what questions you need to ask:

  • Who are my financial dependents – my husband or wife, registered civil partner, children, brother, sister, or parents?
  • Have I provided any financial support for my family?
  • What kind of financial support will my family need in the future if I die prematurely?
  • What kind of costs will need to be covered? such as household bills, living expenses, mortgage payments, educational costs, debts or loans, or funeral costs.
  • What amount of outstanding business loans do I have now?
The correct level of life insurance will make sure they’re taken care of financially

It may be the case that not everyone needs life insurance. However, if your spouse and children, partner, or other relatives or business depend on you to cover the mortgage, other living and lifestyle expenses, or business loans, then it will be something you should consider. Putting in place the correct level of life insurance will make sure they’re taken care of financially.

That’s why obtaining the right professional financial advice and knowing which products to choose is essential. Including the most suitable sum assured, premium, terms and payment provisions.

At different stages in your life, your need for protection will inevitably change

There is no one-size-fits-all solution. The amount of cover – as well as how long it lasts for – will vary from person to person. Even if you consider that currently, you have sufficient life insurance, you may probably need more later on if your circumstances change. If you don’t update your policy as key events happen throughout your life, you may risk being seriously under-insured.

As you reach different stages in your life, the need for protection will inevitably change. How much life insurance you need really depends on your circumstances. For example, whether you’ve had a mortgage, you’re single or have children, or you have business loans that you are liable to pay.

For more information or to discuss any of the issues raised in this article, please contact your adviser, or call us directly on 0161 819 1131. Further information can also be found at gov.uk.

Personal circumstances differ and not all of this information is applicable to every client and/or their business, this information is general in nature and should not be relied upon without seeking specific professional financial advice.

The Financial Conduct Authority (FCA) does not regulate tax advice, estate planning, trusts or will writing.

The content in this article is for your general information and use only and is not intended to address your particular requirements. Articles should not be relied upon in their entirety and shall not be deemed to be, or constitute, advice.

Although endeavours have been made to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No individual or company should act upon such information without receiving appropriate professional advice after a thorough examination of their particular situation. We cannot accept responsibility for any loss as a result of acts or omissions taken in respect of any articles.

Thresholds, percentage rates and tax legislation may change in subsequent finance acts. Levels and bases of, and reliefs from, taxation are subject to change and their value depends on the individual circumstances of the investor. The value of your investments can go down as well as up and you may get back less than you invested. Past performance is not a reliable indicator of future results.

Pareto Financial Planning Limited is authorised and regulated by the Financial Conduct Authority (FCA).