I have Mortgage Protection; is this not life cover?
Mortgage protection is the most basic form of life assurance and the cheapest. It generally decreases each year in line with the mortgage balance outstanding.
Remember, however, that this cover is intended to pay-off the mortgage amount owing to the financial institution. While this may secure a home, it does not provide a cash income to the family.
Is it possible to have life insurance for life?
Yes, whole-of-life cover is a guaranteed life assurance policy which pays out a lump sum in the event of death. There is no fixed term attached to this type of policy; it is cover for the person’s entire life and is therefore usually more expensive than other forms of life assurance.
How much does life insurance cost?
How much you pay varies, depending on the insurance provider, but the main factors that dictate the price include the sum assured for, the length of term of the policy, the type of insurance policy, your age, your health, especially any existing medical conditions, and whether or not you smoke. Policies can cost anything from €15 a month depending on these various factors. As an example a non-smoking couple in their mid-30’s can take out €250,000 over 10 years for circa €30 per month.
How much will a policy pay out?
Each individual determines how much their life is insured for, the amount usually recommend within the life assurance industry being in the region of ten to fifteen times net salary. This figure, therefore, is a key factor in determining the cost of the policy.
What if I get ill and cannot provide for my family?
Specified Illness cover can be taken out as a standalone plan, or as part of a life insurance policy. It pays out a lump sum if you are diagnosed with a condition specifically listed in your policy. This type of policy tends to be more expensive than life assurance, as you are five times more likely to claim throughout the policy term than you are to claim on a death policy.
Can couples get life cover together?
Joint life policies and dual life policies are sold, but note the difference in benefits received by claimants on the two types. A joint life policy offers only one pay-out in the event of a death to the surviving claimant. However, a dual life policy will provide separate pay-outs to the estate on the death of each claimant.