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Life-insurance - do you have it sorted or is it on the to-do list? Share your thoughts and ask Aviva's expert your questions - £150 high street voucher to be won - ANSWERS BACK

(154 Posts)
AnnMumsnet (MNHQ) Mon 04-Nov-13 14:33:36

We've been asked by the team at Aviva to find out if life insurance is ticked off your list of things to do, lurking at the bottom, or is something you keep meaning to get around to but never quite manage it? If you sorted it, why? If you're yet to do so, why not?

Aviva says "As parents we instinctively do everything we can to protect our children. We cover them in sun tan lotion, make them brush their teeth and take steps to keep them safe on the move. Yet, despite our best intentions, when it comes to financial matters, such as sorting out life insurance, other things often take priority. If the unthinkable happened, life insurance can help protect what matters most to your loved ones. That's why we want to make it easier for you to find out answers to your pressing questions."

If you have a question about life-insurance post your questions on the thread and we'll choose some for *Aviva's expert, Louise (see image), to answer. Her responses will be posted on this thread by 18 November.

About Louise: "Louise has worked for Aviva for 24 years and, after gaining a wealth of experience across the insurance business, is now Distribution Director. She is also responsible for the marketing and communication strategy for protection. Louise is extremely passionate about families protecting themselves financially and is a dynamic spokesperson in the national press on the subject.

Aviva's free new parent life cover initiative, which has helped more families become financially protected, is Louises brain-child. She was also instrumental in developing an emotionally engaging approach for Avivas life insurance TV advertising campaign, which created considerable interest, debate and praise.

Louise's contribution to raising awareness levels of protection and challenging customer behaviours has been recognised through a number of key industry accolades. Louise is married with 5-year-old twins and lives in Yorkshire."

So please share your thoughts below - have a look at their info on their special pages on Mumsnet - everyone who adds a comment or a question below will be entered into a prize draw where one MNer will win a £150 high street voucher.

thanks and good luck

PS Please note your comments, anon of course, may be used by Aviva on MN and possibly elsewhere.

CrewElla Mon 04-Nov-13 16:08:43

I have life insurance through my work, I believe that it's 2 times my salary, but that's it (I took advantage of the free £10000 from Aviva for baby's first year through Mumsnet page) but I'm not sure how much is enough. Is there a standard calculation based on salary, number of children you have, etc?

TBH it's not something that I really like to think about too much.

CMOTDibbler Mon 04-Nov-13 16:16:25

I have death in service benefit through work, as does dh, as well as independant life cover. We also have critical illness cover as to us thats almost as important, having seen the hardship caused when someone becomes too ill to work, but not yet with a terminal diagnosis.

10thingsihateaboutpoo Mon 04-Nov-13 20:33:08

We both have 3x salary cover at work and took out joint life policies after each DC was born so we're well covered in that respect.

I do think we ought to have some sort of critical illness policy but there seem to be so many options and i'm not sure of the ins and outs etc it's a bit daunting. I worry we'd end up paying a lot for the wrong thing.

stephgr Mon 04-Nov-13 20:57:54

I do have life insurance which I took out ages ago and I can't recall the details. It's one of "those things" I had to get but which I forget all about until a claim needs to be made. Hopefully no claim will be needed!

hermioneweasley Mon 04-Nov-13 20:59:14

We both have life insurance. If you are not on the breadline, I think it's irresponsible not to.

Theimpossiblegirl Mon 04-Nov-13 21:59:12

Dh is really well covered through work but I'm not.

Something for my to-do list then. I do keep meaning to look into it as although I don't earn much, if anything happened to me DH would struggle to replace the childcare and housework element and still work the hours he does, so the financial impact would be more than the loss of my salary.

Not nice to think about really, but must sort it.

NotAFeminist Tue 05-Nov-13 10:06:59

Neither me or my husband have it... We are young - he's 26 and I'm 21 -and we have a 1 year old and although I would like to have a life insurance policy, I really don't know how to go about it... I find it all kinds of confusing and don't know where to get unbiased, honest advice from concerning this matter. Issues that confuse me like, if you die before a certain time, not all of what's been saved is paid out, or something? I don't know. Like I said... confusing!!! But especially now we have a child, I see the importance of being prepared in case anything happens but I wouldn't know where to start! Any help would be greatly appreciated! :D

maxmissie Tue 05-Nov-13 12:23:07

Both me and have life insurance plus death in service benefit and pensions so if we die we are pretty well covered, provided the insurance company doesn't come up with some reason (based on a visit to the doctor 10 years ago for something that wasn't a problem then but could now be a symptom of the reason for our death) to not pay out!

We don't have any critical illness cover or unemp/sickness cover. We decided not to go for unemp/sickness cover because we figured it would only last for 12 months anyway and we have enough savings to cover ourselves for this time period, plus we have sick pay from work and would get OKish redundancy payments.

However whilst part of me thinks critical illness cover would be sensible, my problem with it is that there are so many options and so many exclusions and it is so expensive, that we would be paying out a lot of money each week, which we may never need if we are never seriously ill and which we would never get back OR again the insurance company wouldn't pay out for some obscure reason.

Whilst things like buildings/contents/car insurance relate to day to day living, with critical illness cover it is a payment for something that isn't part of day to day life and so therefore I think it feels less essential although I accept that it isn't if you become ill.

WowOoo Tue 05-Nov-13 12:44:27

We have life insurance and got it when we bought a house together many years ago. The next step was to have children, so it seemed sensible.

I also think that a lot of the small print and literature is very confusing and deliberately so.
I wish insurance companies would write in plain English.

Do you know if it's possible to change your life insurance provider? I shop around for all other types of insurance. Can I do the same for life insurance? I suppose I will have 'wasted' years of no claims..?

Tee2072 Tue 05-Nov-13 12:51:26

My husband and I both have it, through Aviva in fact. One if the first things we did, along with wills, when I became pregnant.

chicaguapa Tue 05-Nov-13 13:10:05

We have life assurance. We worked out how much we'd each need to cover the day-to-day costs plus paying off the mortgage if the other person died and insured ourselves for that. We also have DIS cover through our work pension schemes but we see this as a bonus as we could leave our jobs and/ or the pension scheme at any time and forget to increase the life assurance. So we haven't included that in our calculations.

We haven't got any critical illness cover. I think we had income protection once when DH was a high-earner and I wasn't working, but we don't have that anymore. We cut all our extras right back when he left to retrain as a teacher.

MinesAPintOfTea Tue 05-Nov-13 14:02:06

We organised it when we took our mortgage out. Will pay off the mortgage on either of our deaths, plus death in service benefits. I have now just remembered we need to do wills though.

It's on the to do list. We are still recovering from a lot of financial troubles but nearly there . I want to ask how you get the best advice without being talked into taking anything out

msmoss Tue 05-Nov-13 14:42:37

We have it both for the mortgage and also to cover a loss in DH's income as he's self employed.

OrganixAddict Tue 05-Nov-13 16:33:26

We have it to cover the mortgage if we die or get critical illness. Separate policy will provide an income in the event of one of our deaths (but that only pays out until youngest dc turns 21).
DH has death in service benefit but if he were to get terminal illness, it is possible he would have to leave job before dying so we decided not to include that.
What I wish I'd been made more aware of was that it is worth over insuring when young as premiums lower rather than trying to increase cover when older. DH & I will both be 40+ at next move and need to cover an extra 100k of mortgage I expect which could be very expensive!

sleeplessbunny Tue 05-Nov-13 20:32:03

We both have 4x salary death in service benefits from our employers, plus a joint life/critical illness policy we took out when we bought our first house to cover the mortgage. We have since moved though so it now covers about 60% of our current mortgage, but rates have gone up so much (or is it because we got older?) we decided not to extend it. I occasionally have a nagging thought to do something about it but I seem to always manage to shake it off.

Pipparivers Tue 05-Nov-13 20:38:31

I have cover but not enough to cover the mortgage. my house would have to be sold but that wouldn't put any unnecessary pressure on my beneficiaries.

majjsu Tue 05-Nov-13 21:19:26

My husband has death in service through work. As I am now a stay at home, I have nothing. Not sure if its worth getting as when I return to work, many employers offer this?

sillymillyb Tue 05-Nov-13 21:26:37

I got life insurance when my baby was about 3 weeks old. I am on my own with him, and realised that if anything were to happen to me he would have nothing - it really terrified me!

I went to a friend who was a broker, and ended up with a policy that pays out a lump sum and a monthly amount in the event of my death.

I think I pay about £12 a month, and its well worth it for the peace of mind it gives me.

telsa Tue 05-Nov-13 21:40:03

I think I have some death in service benefit. Not sure. head in sand. I have a flat that the children can sell if they need money. What use is money anyway though?

sharond101 Tue 05-Nov-13 22:00:40

DH has life insurance but noone will insure me due to my having ill health in the past, it's shocking!

pussinwellyboots Wed 06-Nov-13 10:27:21

we have life insurance for the house in that the mortgage would be paid off in full, and also through work (both public sector employees) we would both get 3x salary plus other pension benefits- we feel that this would be enough to continue an ok quality of life if the worst happened considering that there would be no mortgage to pay.

manfalou Wed 06-Nov-13 10:55:34

OH did have life insurance with his work until he went self employed... now none of us have neither. Something we talk about quite often and do need to sort out.

Lent1l Wed 06-Nov-13 11:27:38

I am very lucky in that my work automatically provides 3x my salary for Death in Service and then through our "Choices" programme we are allowed to sacrifce salary once a year to buy more holidays, critical illness cover, health insurance etc. And one offer is that each year you are allowed to top up the Life Cover by 1x your salary. You can do this until you reach a maximum of 10x your salary, as I've been doing this every year for a few years now think I'm at 7 at the moment. This would certainly pay off the mortgage and give a good lump sum for my husband to use. We have discussed that as my husband is a house husband currently we don't have much in place for him and should probably sort something so that I could work less if something happened to him.

Spirael Wed 06-Nov-13 12:27:46

My DH and I don't have a specific Life Insurance policy, but we're both well covered by our works and our pensions so that if either of us die or are incapacitated the money paid out will cover the remainder of the mortgage and probably a bit more.

MadMonkeys Wed 06-Nov-13 13:12:58

We have DH insured through work and both have life cover in a bundle with critical illness and mortgage payment protection. We need to go through it all and make sure we aren't paying more than we need to through as we haven't shopped around for a while.

IncaAztec Wed 06-Nov-13 13:14:11

We get optional life insurance through work. Otherwise, it would probably languish at the bottom of our 'to do' list forever. I think for some, it is probably just another cost they can't afford at the moment. However, it is important to think about how your family would cope, particularly if the main breadwinner passed away or became critically ill.

BikeRunSki Wed 06-Nov-13 13:29:10

My husband and I both have death in service cover through work, him 3 x salary, me 2 x. We have had life insurance since we bought our first house, 13 years ago, and critical illness cover. DH was made redundant 2 years ago, but very fortunately got a new job, same salary a month later, but we have income protection cover now too. When DS was born (he is now 5) put IFA suggested we made wills, so we saw a solicitor who did them, much cheaper than I thought it was going to be. The will says who is to care for ds in the event of both dh and I dying. We made sure there was insurance cover for financial provision for ds too. We reviewed the will and insurance when dd (2 now) was born.

My dad got ill when I was 12, and his health and capacity to work deteriorated over 11 years. He had no life insurance or anything and put huge pressure on my mother who had 4 children to raise! It blighted that period of my life too, and financial insecurity makes me very stressed and upset, to the point that I have physical symptoms. We deliberately live in a v modest, slightly-too-small but easily affordable house, which was a blessing when dh was made redundant when dd was 4 weeks old.

It would never occur to me not to have life insurance with children and a mortgage !

gretagrape Wed 06-Nov-13 16:02:22

We've both got 2x salary cover for death in service, but that's it. Once I go back after maternity leave we'll hopefully have enough money to take out decent cover for illness/unemployment/death but at the moment there just isn't the money to cover the premiums.

WhisperingPea Wed 06-Nov-13 16:20:30

We've both got life insurance taken out 16 years ago when our daughter was born; one is straight life assurance the other would pay a set amount each month. They both end in less than 2 years and we're wondering what to do at that point. The house is paid for and we've savings that would support her for a good few years. Does Aviva have any advice?

CheeseTMouse Wed 06-Nov-13 18:02:56

We have life insurance which we got when we bought our home together. The reason we got it sorted is that although we are both youngish, we didn't want the other to have to worry should anything awful happen. This is compounded by now having a young family. Next on the list is to sort out our wills... something we have both been putting off for ages!

BlackberrySeason Wed 06-Nov-13 19:11:03

We really need to do this - I have it but DH doesn't and he is the main breadwinner.

StillNoFuckingEyeDeer Wed 06-Nov-13 19:17:59

I have no idea about life insurance. It's on my to-do list, along with getting a pension.

I think DH must have some kind of cover through work, but I don't know. I really should look into it.

RedBushedT Wed 06-Nov-13 19:18:20

I have 3x salary cover through work and also a substantial policy I've taken out privately. I think it's given me a little bit more peace of mind knowing that my children will be financially secure should anything happen to me. Money is extremely tight for me since I got divorced but life cover is something I couldn't be without.

GetKnitted Wed 06-Nov-13 21:13:03

Sorted out the life insurance this year, it will cover the house and more should the worst happen to one or both of us. My worst fear was not what myself or my dh would do if the other died, we'd be devastated, but the boys would be looked after one way or another, but the thought of them being alone in the world with our families carrying both the emotional and financial repercussions of losing us, too awful to imagine.

Dededum Wed 06-Nov-13 21:18:14

We have life insurance which would pay off mortgage and DH has insurance through work.
We pay £37 a month

Want2bSupermum Wed 06-Nov-13 21:25:40

Yes we have life insurance. DH has $1.5 million and I have $1.25 million. It is term insurance - 30 year level term so cheap at $70 a month for me and $90 for DH. I got to the amounts based on costs to cover raising our children should both of us pass away. It would be enough to cover everything including their university/college education.

BTW - don't know the law in the UK but in the US minors can't inherit money. We have a living revocable trust set up which inherits the money and allows it to be spent by the guardian before the children at 18.

Roundles Wed 06-Nov-13 22:24:27

When should I start panicking! 31, no children, no life insurance, but a partner of a similar age who I would hate to leave with nothing.

We are both on low-ish incomes, job security at the moment is an issue for both. Where do we start?

Want2bSupermum Wed 06-Nov-13 22:38:15

Roundles - Im no expert but I did was work out what income was needed to enable me or DH to continue with life should one of us pass away. I then worked out what my brother would need to raise our 2 DC should both of us pass away now.

Since you don't have children I would calculate the insurance need based on what you would bring to the table in terms of retirement contributions and cost of your funeral. I think anything in addition to that is gravy.

I don't know about insurance in the UK but here in the US it is far cheaper to do a level term insurance. That means for x number of years you pay y amount. Should you pass away during those years of coverage you will get paid out the amount per the insurance. I have 30 years coverage and will be 63 when it expires. My kids will both be old enough at the point and we will have enough in retirement that we won't need life insurance at that point.

Lily311 Thu 07-Nov-13 07:19:02

Can I urge everyone to take out life insurance cover? My partner died at the age of 35 last year and we had a joint life insurance policy Also he had a death in service package, twice his salary. I was left alone pregnant with our daughter who was born 5 months after. The money paid off our mortgage and now allowed me to stay on mat leave for a year. Without it I would have needed to go back to work after 6 months and with a possibility of an extra £5000 debt. When something awful happens unexpectedly it is good not to worry about finances.

Yes, I have a new cover as well as a will. I pay £12 a month for £150000 life insurance cover and £15000 critical illness cover.

elizaco Thu 07-Nov-13 08:40:21

My husband and I have a life insurance and critical illness insurance policy each PLUS an extra one that pays out on death of first. All policies were 25-year when we first took them out - probably about 12 years left. We took them out just before starting a family. We live in a tied house (with my husband's employment) so if I was to lose my husband I would of course, need to then buy a house. Still need to get wills written though :-(

MissRee Thu 07-Nov-13 09:10:50

I have 4x salary through my work and a life insurance policy on both myself and my partner which we took out when buying our house. My partner doesn't get a death in service benefit from his employer, should we be looking at something else to help me should anything happen to him?

We did have critical illness cover but I think the policy lapsed. I must dig out the paperwork for that and renew it!

heyday Thu 07-Nov-13 13:08:55

My daughter had her son when she was only 17 so as soon as she was 18 I took out life insurance for her. As she is so young the premiums are low and the pay out would be enough to somewhat help look after little boy. To anyone with children, if you do not have decent life insurance then stop putting it off and get it sorted. It really does give some small piece of mind if the worst was to happen.

trilbydoll Thu 07-Nov-13 17:45:52

We both have 3x salary through work and we have a policy that matches the mortgage, so the cover decreases in line with the mortgage outstanding.

I'm not being naive in thinking they would both pay out if one of us died am I? This has only just occurred to me, I have always assumed the mortgage would be cleared and then the work cover would pay out a lump sum.

I think we need critical illness cover as well, but it wouldn't know where to start, I am deeply suspicious of those policies because of all the stories about them not paying out.

Lily311 Thu 07-Nov-13 18:09:29

trilbydoll yes! both pays out. It did for us.

jobwoes Thu 07-Nov-13 18:16:25

My DP has death in service cover through his pension scheme, but can't get critical illness cover as he has had a critical illness, even though he has fully recovered sad.

DH and I both have life insurance that we sorted out when DH started his own business. It's something we got quite organised with quite a few years ago and we both feel is very important. Even when we were struggling financially a couple of years ago it was one of the things we hung onto.
I also have some sort of cover with my job but I confess i can't remember what it is exactly.
It's the sort of thing you hope you'll never need but I know a family who sadly experienced a tragedy and if it hadn't been for the insurance I can't imagine how they would have coped.

LegoCaltrops Thu 07-Nov-13 21:07:39

I have a pension & life cover through work, there would be 4x salary on death (with Aviva I think) but nothing else. DH is currently a student & we're on a tight budget so I'm not sure about cover for him at present. We rent so we wouldn't benefit from unemployment cover for me at the moment - or would we? I worry that we aren't covered for this sort of thing.

Dancealot Thu 07-Nov-13 21:10:36

Both my partner and I took out like insurance when we took on a bigge mortgage. It means if anything happns to either of us at least the house will be secure for our family.

We both have insurance through work, but it's worth mentioning that this is often based on your salary. So if you are part-time, you might not actually get a huge amount (but the remaining partner would then have to cover all childcare costs etc if they were to continue working). So we got an additional policy to top mine up to a more realistic level.

Also, while we're on the subject of unexpected deaths, can I remind everyone again about making wills - it's really important even if you think you know what would happen to your property (it may not...and gives the survivors a lot more stress), and it allows you to consider things like what would happen to your estates if you both died, how you would want your children cared for and so on.

Bubbles85 Thu 07-Nov-13 21:34:51

Life insurance and a will are both on our to-do list. I am currently pregnant with our first child so we plan to get all that sorted ASAP for the baby's sake.

daisybrown Thu 07-Nov-13 22:58:27

We have joint life insurance to cover the unimaginable happening, such as mortgage and extra childcare that would be needed if the worst happened to one of us.

Willemdefoeismine Fri 08-Nov-13 07:21:42

I think we've been burying our heads in the sand about this one. I think when I was younger I didn't think I would have children so didn't even consider it a 'must' in an era when I had more disposable money and was more focused on managing my finances for the future....

I think we might need to revisit life insurance ASAP!

AtticusMcPlatypus Fri 08-Nov-13 08:04:05

We both have life assurance with critical illness cover. We don't have a mortgage, only rent so it would hopefully provide a financial cushion should the worst happen or provide a lump sum to put towards a property. I also have death in service benefits from my employer and my husband has a, now frozen, local government pension which will still pay a lump sum on death before retirement age.

lolancurly Fri 08-Nov-13 08:05:00

I don't have life insurance and this is something that bothers me and that I want to sort out. I am 50 with a 6 year old daughter and as my mum died when she was 56, I feel painfully aware of my own mortality. Although I should sort something out, part of me wants to stick my fingers in my ears and sing lalalala and not think about it. My husband has a good job, but as a contractor doesn't currently have life insurance through his employer, so we do need to get our bums in gear on this one.

RubySparks Fri 08-Nov-13 08:09:06

Another be with life insurance and various critical illness and accident cover through my employer. I think the life insurance is joint so husband covered too but not on some of the other insurances as they can be expensive. Would be interested to know how much is enough! I work almost full time so would need help at home is something happened to husband, he would just need enough money to live.

Dolallytats Fri 08-Nov-13 09:50:21

We don't have it. It's on our to-do list and we talk about it often, we just don't have any money to do anything about it.

DH lost his job just before our DD was born. A couple of weeks ago he had a mini stroke and has been signed off looking for work until early Jan. I can't work, I'm agoraphobic. Finances are very tight-£1000 in the overdraft.

As soon as we can, we'll be arranging things.

EstoyAqui Fri 08-Nov-13 10:02:04

DH and I both have 2 separate policies. One through his work provided free along with free critical illness cover. Another that we organised when I found out I was pregnant with DD.

The work one pays out £100k as a death in service payment then an ongoing pension to the survivor. I think if DH dies I would also get £125k as a tax free lump sum on top of the death in service payment.

The independently organised ones are £250k if I die or £150k if DH dies. DH has high blood pressure and is on medication daily for that so to get higher cover for him is ridiculously expensive. I figure we will be able to pay off the mortgage if either of us dies with enough for the other to not work for 3 years at the level we currently do. We will still receive a pension so I'm comfortable with that.

When we move home I will re-evaluate our level of cover and increase as necessary. We are lucky that our mortgage is quite low at the moment but that is my biggest concern long term.

These plans are not our only savings vehicle and I feel comfortable that we have adequate cover. I'd like to hear what is recommended though.

HairyMaclary Fri 08-Nov-13 10:23:23

We have one to cover the mortgage and one to pay out a lump sum in the instance of the first death, of either of us. It's not a big lump sum but it's enough to cover 2 or 3 years. DH also has critical illness cover we pay for and very basic DiS benefits from work, I don't have either as I'm mostly a SAHM.

We got this very soon after DS1 was born as he is disabled and we felt that we would really need the best financial cushion we could afford in the event of the death of a parent. It does stretch us a bit though and we have discussed dropping one of the policies. I am reluctant to though!

Meglet Fri 08-Nov-13 10:56:51

Yes, I have life insurance and income protection. I'm a LP so I've had to do as much as I can to protect the DC's.

I'm never quite sure how easy it would be to claim, or what loopholes the insurance company might use to wriggle out of it. I've been meaning to go back over it and check the fine print again.

DeathByLaundry Fri 08-Nov-13 11:11:40

We took out life insurance with our mortgage. I've recently changed it to fixed term so there would be a little bit leftover after the mortgage is paid off. We also have a joint critical illness policy. DH has good work related benefits (death in service, pension etc) and I have an income protection policy to make up for the lack of work related benefits!

Our monthly outlay on insurance is huge but I wouldn't be without any of it. I'd hate to think I'd leave a mess if I was hit by a bus. I'm fairly financially savvy but DH isn't, and his earning power is less, so I need to be sure they'd have a house to live in.

ShatnersBassoon Fri 08-Nov-13 12:19:01

DH is sorted through work, but I have nothing in place. It's something I think about from time to time, but it never seems pressing or important enough to sort out.

I have death in service through my employer, DH does not plus we both have life assurance, critical illness policies plus we have made our wills. Tedious and confusing stuff to do bit v glad it's been taken care of just on case

AndHarry Fri 08-Nov-13 13:05:23

I'm covered three times. My company runs a death-in-service payment scheme, which would give a lump sum to my named beneficiaries if I die while I'm employed here. DH and I both have life insurance as a condition of our mortgage so it would be paid off in full if one or both of us died or suffered a critical injury or illness. Last week I also set up additional life cover of £100k lump payment if I die in the next 20 years. Let's hope DH doesn't get any ideas grin

AndHarry Fri 08-Nov-13 13:23:10

Questions:

- Is there any way to make sure that if I died and DH remarried and then died before his new spouse, our children would receive some of my payout? I wouldn't want to leave it in trust to them as I can imagine a lot would be needed to pay for childcare and other expenses but I wouldn't want them left unprovided for either.

- The thing that puts me off getting additional critical illness/injury cover is that it seems that insurance companies try very hard to not pay out. Can you talk a bit about that please?

asuwere Fri 08-Nov-13 14:17:48

We have it, it's a fixed lump sum payout which at the time we took it out was worth our mortgage plus 18months salary so obviously as the mortgage goes down, the lump sum will be worth more. It's a joint policy so if either of us dies, the other will have the mortgage paid off, enough to cover funeral costs plus being able to take at least a couple of years off work if necessary.

hunhun007 Fri 08-Nov-13 16:57:45

I don't have a life insurance. OH got it but only because his work provided it.
It was on my "to do list" years back but I never really knew how much money beneficiary will really get in case something will happen and despite doing some research this question was always unanswered ... so here I am still without it

jennifercrafting Fri 08-Nov-13 17:46:55

I have applied for life insurance in the past but it was way too expensive for us and so I didn't take out the policy. It would be great if I didn't have too cover myself for a large amount and then the payments might be more affordable.

Tigerbomb Fri 08-Nov-13 17:48:24

DH has 2 x salary through work and I have 7 x mine - I am able to pay a smal amount to have it increased each year. He will be considerably better off if I died before him then I will if the reverse happens

He has life insurance but I can't get it due to a long term health condition that only appeared 5 years ago - I wish I had arranged it before then

We both have wills though

mamof3boys Fri 08-Nov-13 18:34:27

We haven't got life insurance, although I know that we should. We did try to apply for it a few years ago but I'm not sure what happened to the application. My husband had cancer around 15 years ago so I'm not sure if that affected it?

It really is something that I need to look into as we have 3 children, but to be honest, I'm not really sure where to start. There just seems to be so many different options and it confuses me.

DoctorGilbertson Fri 08-Nov-13 18:34:35

I have life insurance. Got it at the same time as the mortgage.

DinoSnores Fri 08-Nov-13 18:52:44

When I was working, I had a Death in Service benefit but nothing now. One of the things we keep talking about (but not doing anything about) is how even though I don't earn money, it would be very expensive to replace me with a nanny/childcare/cleaner etc if something bad happened. While I like to think they would all miss me as well, I'd hate for life to be practically more difficult in addition.

MollyBerry Fri 08-Nov-13 18:58:55

I don't have any life insurance but also don't have any dependents so don't feel it's currently worth it.

Tortoise Fri 08-Nov-13 19:16:20

I have life insurance but I think it's only until youngest child is 20 but I'm not 100% sure. I should check really.

ouryve Fri 08-Nov-13 19:27:59

DH and I both have life insurance. With two boys with SN, either of us could end up in a very difficult situation, financially, if anything happened to the other.

perfectstorm Fri 08-Nov-13 19:29:39

We have it via Cavendish, who rebate the commission all brokers get from insurance companies back to you. We pay less than Legal and General charge you directly on their website - will save us over a grand over the term of the policy. (They also had a close offer from Aviva; we went for L & G on literally a pound a month's difference, I think? I would imagine who is best buy varies regularly.) If anyone does want an insurance product I would strongly recommend Cavendish - you pay a flat fee of £35, and then all the commission is deducted from your product. Saves a packet and doesn't cost providers any more than it would if you went for a conventional, commission-earning broker.

We have insurance because we have a young child and a baby on the way, and we want the surviving parent to be able to own a house outright and take a couple of years off work to care for the children and help them through the loss, if one of us dies. The work policy is nowhere near enough to do that.

We were pushed into doing it because a friend's sister-in-law was abruptly widowed. Her husband was healthy and young and one day he just dropped dead. Undiagnosed heart problem of some kind. She had no insurance, few assets and two young children, but luckily she also had comfortably off siblings who have supported her a lot. We don't have that, so it galavanised us into taking action. It's a few hundred quid a year and we hope it's a total waste of money, but just imagine if it isn't? sad

We also went and checked our medical records, to ensure there were no mistakes which could invalidate the insurance (a friend had a termination and a coil on hers, which was surprising as she is a lesbian - always worth checking!). It only costs a tenner each, and it's well worth the hassle IMO.

perfectstorm Fri 08-Nov-13 19:34:12

Link to Cavendish, to posters not sure where to start. I read about them in a paper and then lost their info, but they're recommended on Moneysavingexpert as well - I'm a regular poster, not a schill, honest guv'nor! I just like saving £, so thought it might be handy to someone else. smile

Iggity Fri 08-Nov-13 22:26:41

I dont have any for two reasons. One if my work pays out three times my salary if I die while working for them. Second, I had my insides removed a few years ago due to borderline tumours on both ovaries and am worried that insurance company will not insure me. Its on my list of things to do as DH doesnt have any so if he dies, we will have nothing.

goldenretriever Sat 09-Nov-13 07:54:07

I took out life insurance after the birth of my first child. Had never thought about it before, but I am financially the one who brings the money in, so felt compelled to do it.

cashmiriana Sat 09-Nov-13 10:03:08

We have cover for our mortgage, a term assurance policy for a reasonably substantial lump sum, DH has a death in service benefit, and we also have family income protection. If something happened to either one of us the survivor and our DC would not have to worry about money. Even more important however is making a will!

Carriemac Sat 09-Nov-13 10:07:22

My husband had cancer 20 years ago so I don't know if we would get it? Have death in service benefits from NHS

HootyMcOwlface Sat 09-Nov-13 11:22:12

Yes, we have taken out the free Aviva new parent cover, plus we have cover for me and DH for our mortgage and we both have death in service policies through our jobs.
When my mum died it made a huge difference having the insurance cover. Me and my DB did not have to worry about funeral expenses or paying her mortgage, and so I've always had cover for myself.

DragonPaws Sat 09-Nov-13 12:03:34

We have life insurance to pay off our mortgage but it costs a fortune as DH has a critical illness even though he is healthier than me.

We have life insurance through Aviva. What I am terribly confused by is the trust element. We'd like to write it into trust but there's no indication of whether a trustee can be a beneficiary, and when I've phoned Aviva to ask they just say they can't help. Great! Would also like to know how to deal with future children. For instance, can I make DH both trustee and beneficiary so he can dole it out as appropriate to DD and hypothetical future children? Why can't I put future children on it-why do beneficiaries have to be named specifically? I know we need to go and see a solicitor about this but we don't have a spare £500 and it's driving me nuts. that something so easy is made so difficult by such a stupid form.

nextphase Sat 09-Nov-13 14:23:33

Life insurance through work.
I wish people would stop assuming its a crap deal with work (7x salary, 11 for accidental death, and yes, I have got those numbers right), and trying to sell me more.

My question is, what happens if we change job. Will we get stung, as we are much older when taking out the policy?

AnnaConda Sat 09-Nov-13 14:23:39

We had life cover with an endowment on our mortgage but that's now paid off and the policy matured.

Dh has generous life cover through his work.

I wish we'd paid for me to have critical illness cover as it would have been a tidy lump (appropriate word!) sum when I had breast cancer a few years ago. <Sighs>

tinypumpkin Sat 09-Nov-13 14:53:00

I am quite paranoid about this type of thing. We have life insurance and also our mortgage protected in the event of the death or critical illness for DH and I. Death in service but not loads tbh so not able to rely on that for help.

YoniRotten Sat 09-Nov-13 15:01:33

I wish. I had a malignant melanoma three and a half years ago. I am now in the clear, and the doctors say it is highly unlikely I will get again. I am monitored regularly to be on the safe side, so in the unlikely event I do get it again, the chances of catching it early are better than the average person's, yet I can't get life insurance. What am I supposed to do? I lead a very healthy lifestyle (never smoked, teetotal, good diet, exercise) so am really surely a catch for life insurance companies, yet a small dodgy mole has scuppered all efforts to get cover.

Happiestinwellybobs Sat 09-Nov-13 15:29:16

DH is self employed so nothing there. I get 1x my salary, but on part time hours this doesn't add up to much. We have mortgage cover but apart from that zilch.

And just writing that makes me panic!

Jellykat Sat 09-Nov-13 16:34:47

Life insurance has been on my to-do list for quite some time, i'm a self employed lone parent, so nothing via work or spouse.

There is something that terrifies me, and yes, it is completely coincidental i know, and very very woo.. but.. i had 3 friends (all in their 40s) who took out life insurance - all have died recently (2 extremely suddenly) within 3 years of taking it out. sad
Theres a tiny bit of me that worries about tempting fate or some such..
Completely crackers i know! but add that to the fact my DSs are 24 and 16, and they will inherit my house outright, and it explains why it's still on my 'to do one day' list, and not done. confused

flamingtoaster Sat 09-Nov-13 17:21:30

I always had the crazy idea that taking out Life Insurance (and making a Will) would make it more likely I would die but when we had DS my husband insisted we sort it all out for their sake. I still worried about it but we sorted it out and I am still here!

CheeryCherry Sat 09-Nov-13 17:24:50

Another one here who has been putting it off, alongside a Will... we can't afford the extra costs involved so haven't been able to protect ourselves. sad

DH and I really, really should get around to getting insurance but haven't -neither do we have wills...

IceNoSlice Sat 09-Nov-13 18:34:14

Me and DH have 4x salary through work schemes. Plus critical illness cover. But I think it might not be something we'd remember to replace if we left our jobs. This campaign is a good reminder. I think double checking all our financials inc pensions and insurances will now go on our to do list!

androbbob Sat 09-Nov-13 19:11:06

I have life ins and so does DH as separate policies. We also have death in service benefits through work pensions. We also have an income protection policy until DD is 21. I suspect this needs extending as DS is 5 yrs younger. I reckon we pay out about £50 a month between us.

Not sure if we are adequately covered. Would be useful to know this. We have 8 yrs left on mortgage so biggest expense is getting less each month n year now.

Maiyakat Sat 09-Nov-13 19:25:03

Before DD arrived I arranged life cover that would pay off the mortgage, I also have some cover via work. As a single parent I think I'm especially aware of ensuring DD is provided for if anything were to happen to me.

Cucumberscarecrow Sat 09-Nov-13 20:32:47

I tried to take out life assurance before but was completely daunted by the level of medical background required. I am fit and healthy in my late 30's but don't know what my great-grandmother died of and whether my diagnosis with borderline asthma 18 years ago following some time in smoggy Mexico City was relevant and whether there were other minor things I was forgetting but whose omission would void the policy. I gave up.

In other words, I really want insurance but am terrified by the burden of the application process. Can Aviva help simplify this or give tips on how best to deal with it?

BooMeowson Sat 09-Nov-13 20:54:09

My husband has some with work, but I have to admit I'm not convinced it would be worthwhile for us to pay additional money for me.

Yogagirl17 Sat 09-Nov-13 20:57:07

Should I still be paying my ex-husband's life insurance? It's designed to cover the mortgage for the house I'm still living in so maybe I should..?

happybubblebrain Sat 09-Nov-13 22:00:57

I don't have life insurance and it hasn't ever been on my to do list.
Most insurance is a rip off.

gloriafloria Sat 09-Nov-13 22:30:07

We've both got death in service at work and I've also got mortgage protection life insurance but dh couldn't get this due to health probs. I do feel we are under insured and either one of us would struggle if left on our own. I've been reminded recently, following the very sudden death of a family friend, of the importance of planning for the unthinkable sad. Making a will is now a priority for us along with reviewing life assurance.

janekirk Sat 09-Nov-13 22:32:32

I have life insurance attached to my company pension.

ataraxia Sun 10-Nov-13 00:07:35

Like others, I have coverage through work but doubt I would get a policy otherwise. Maybe that would change if I had kids.

Littlecherublegs Sun 10-Nov-13 15:23:07

We don't have life insurance though through our pension schemes we would have 'Death in Service' payments.
Saying that, now we have a DS it is something we need to have a think about and possibly something we need to purchase.
Wills and pension payments / beneficiaries are also things we need to consider.

Babcia Sun 10-Nov-13 23:57:35

I wouldn't get it through Aviva- I specifically opted out of our company pension plan because it was through them. I wouldn't trust them as far as I can throw them with my money. They massively mismanaged a policy my parents had with them, so they can whistle for it.

custardo Sun 10-Nov-13 23:59:40

life insurnce 3x salary at work

Steffanoid Mon 11-Nov-13 09:13:29

me and my dp both have life insurance policies, they will cover the mortgage if one of us dies, he's got his pension and death in service grant too, I dont think we'd have really considered life insurance if it weren't for it being explained when we took a mortgage

Ragwort Mon 11-Nov-13 09:18:15

Yes, both have life insurance, costs around £75 a month each, we are self-employed so essential that we have this. However, may review the amount of life cover we need now that our DS is older, initially the thought was enough to ensure a nanny or similar if one of us died so that child-care would be covered. We have no mortgage. We both have pensions, not very good ones though!

Ragwort Mon 11-Nov-13 09:21:11

Meant to add, my DH's own father died very young leaving a widow and five young children, he had no life insurance and DH always remembers how difficult it was financially - in addition to the sadness of losing his father of course. sad. That has made him incredibly prudent in all our financial arrangements.

To contrast - my own dad also died young but had fantastic cover (through his work) which gave me an 'allowance' right until I left university, plus support for my mother until she re-married.

mumsbe Mon 11-Nov-13 13:55:37

Its ony to do list but i cant really afford it or understand it. Whatkind of insurance do i need if i want a lump sum pay out to my children?

Orange01 Mon 11-Nov-13 21:16:58

My husband and I have joint life insurance and separate life insurance from before we were married, we have critical illness cover and death in service cover through work.........honestly we are worth more dead !!!!!!smile

VikingLady Mon 11-Nov-13 21:24:09

DH and I both took out the Post Office's free life insurance offer for new parents, but that ran out when DD turned one. We have none now and really need to get this sorted. It is so expensive though! I cannot find any policy that is ongoing for a lower monthly fee, only fixed term policies.

whattodoo Mon 11-Nov-13 22:06:45

My DP has cover through his employer.

I have cover through 2 endowment policies, but probably not sufficient.

We really should get proper advice about what I'd best for us in terms of product and amount.

A question - does it matter that we aren't married? Our wedding is next year so would it make sense to wait until after then? We have a DD.

moonbells Mon 11-Nov-13 22:17:25

I have cover via my employer and in addition we have mirror life policies which we set up when we did the last remortgage. Stupid cost - DH is all of 3y older than me and has to pay twice as much.

MegBusset Mon 11-Nov-13 22:21:23

DH and I have decreasing term cover to pay off our mortgage. We sorted it out soon after the DC were born. I also have death in service benefit through work.

We haven't got critical illness cover though as there are so many exemptions and it seems very unlikely that the insurance company would ever pay out. In fact the whole insurance thing seems like a bit of a scam really.

i have to hope I die at work or DD will be reliant on my parents for everything lucky they have money

SetFiretotheRain Mon 11-Nov-13 23:02:43

Message withdrawn at poster's request.

Flatasawitchestit Mon 11-Nov-13 23:14:12

We aren't home owners yet but didn't even have basic life insurance even though we've 3 young children. It was just one of those to do jobs that never got done.

Then my dad died suddenly. He didn't have life insurance either. Sorting out all of his and my mums paperwork and the sheer hassle and lack of money that was available to help my mum was one of the most stressful and upsetting things ever. When you're grieving for someone close to you, money is just something you don't want to have to worry about. Still 10months on its causing my mum financial difficulties, that's why not long after my dad died we had a financial advisor come around and sort out our finances and get life insurance. I'd never want my children to deal with the things I've had to.

Bambi75 Tue 12-Nov-13 11:31:20

Yes - we've got life insurance, critical illness cover and other financial instruments in place to ensure whatever happens at any time we're covered. I'm covered as a stay at home mum to ensure we have the costs of childcare taken care of if anything happens to me so my husband can continue working. My husband is covered so that if anything happens to him our mortgage is instantly paid off and things like school fees and other day to day expenditures are totally covered.

My husband is a wealth management consultant and deals with this sort of stuff everyday for his clients so we're lucky in that we know that the policies we've got in place to protect us are 100 per cent robust.

I do think that if you're thinking about taking out life insurance, critical illness cover etc its absolutely critical you seek the right sort of advice because a lot of these policies have exclusions and other terms that if you don't understand, then you could really be caught out when it comes to paying out. Id even go so far as to say avoid high street IFAs and seek specialist advice. This is the sort of thing you don't want to get wrong.

lottytheladybird Tue 12-Nov-13 12:33:32

We have life insurance. I made sure we had life insurance sorted out soon after our first child was born. It's nice to know that it's there in case of anything.

48th Tue 12-Nov-13 13:19:51

We have sufficient that if either died the mortgage wold be cleared with 150,000 left over and 1800 monthly until children are 21. We are covered separately so there is a much bigger lump sum and double monthly payments if we bth died. Have friends in pace to take on the parenting so wanted o cover their expenses as wlk as leaving money to te children.

We don't have critical illness, dh doesn't really need it for a couple of good reasons.

sealight123 Tue 12-Nov-13 21:05:15

Truthfully, Life insurance is something that always crops up with me and my partner but it always falls down the priority list....we know we need it, to ensure that if anything happened to us (touch wood, nothing will) that our family is secure and taken care off, but you always think you have all the time in the world. Thinking I might check out some now and check with my workplace if there are any options for me through them as well. eeeps

Badvoc Tue 12-Nov-13 21:14:08

My dh is covered through work (very good package) and I have private life insurance (with aviva!!) currently Until my youngest dc is 18.
We also have mortgage cover so if anything happens the house is also paid off.
We have wills and have appointed guardians.
Awful to have to think about, but I lost my beloved dad in July very suddenly and unexpectedly and - believe me - even as adult children it was so much easier that dad had a will, that he made his wishes clear and that he had taken out an insurance plan to lay for funeral expenses (also with aviva)
I cannot praise aviva enough actually. My brother phoned them, explained my dad had passed away, they requested his death cert and within 2 weeks my mum had the money in her bank account - which was much better than a cheque and having to pay it in etc.
It's very difficult. It's something none of us want to think about but something we all need to do.

petalsandstars Wed 13-Nov-13 04:29:40

We never bothered with life cover until the dcs arrived and now we have cover to pay off the mortgage outstanding. Plus other death in service benefits. If we both went then the house can be sold for the proceeds to go to the children or in trust for their guardian to support them.

My DH has life insurance from his home country but I don't.

Does it make a difference if you're a stay at home parent?
Is it really worth paying for?
It's one of the things I keep thinking about but never get round to sorting it out.

THERhubarb Wed 13-Nov-13 12:27:22

I don't have Life Insurance or contents insurance. In fact the only insurance we have are on the cars and buildings insurance.

We've had around 15 years where we have successfully lived without these types of insurance. So say we paid £30per month for contents insurance, over 15 years we would have paid over £5,000 and yet we've not had cause to make a single claim.

We have enough savings to be able to replace items through damage or theft and the buildings insurance covers the main things, like the very roof over our heads.

Life insurance to me, is the same. You could pay out thousands over your lifetime and never have cause to use it. In fact my IFA told me that these days critical illness cover is more essential than life cover because more people are surviving illnesses.

I also have a deep mistrust of insurance companies. Whenever we have had cause to put in a claim for the car (once someone stole dh's motorbike, then someone uninsured crashed into the back of our car and drove off) they have prolonged it and prolonged it, demanded paperwork that we didn't have (like injury details when there were none), told us they didn't receive stuff we'd sent, and generally just dragged their heels in settling a claim which actually left us out of pocket. In the case of the stolen motorbike, they eventually settled 2 years later and the in case of the car it was 18 months later after I wrote a very terse letter to them demanding to know what the hold up was.

I think the last thing my children will need after the death of one of their parents is a huge headache with the insurance company because if they can wiggle out of paying, they will.

Luckily we don't have a large mortgage and are currently overpaying so it should be paid off within 10 years. We both have pensions that will pay out a lump sum should we die and dh has something with work that will pay a nominal amount too. We also have some savings that should cover the rest.

I would much rather pay monthly amounts in a savings account which my kids can gain access to upon my death than to a Life Insurance scheme.

ILoveAFullFridge Wed 13-Nov-13 12:55:52

The day we discovered that I was pg with dc1, dh went online and bought life insurance. Other women got flowers - I got a rather less romantic demonstration of dh's commitment to us. smile

milliemoon Wed 13-Nov-13 19:54:08

We have life insurance. Always meant to do it so glad I can now tick it off my to-do list

We got life insurance when we took out a mortgage - its for the value of the mortgage (I thought this was a condition from the bank, to insure they get their money back??).
We also have critical illness cover for both of us. DH works and I'm a full time stay at home parent, so if I died or was critically ill, we would want DH to become a full time parent, so its as important for me to be covered as it is for him.
About a year ago DH spent several long evenings researching it all and changed our policy providers for both policies, to get more cover for less monthly cost.

shezzle Thu 14-Nov-13 22:22:34

We have had life insurance since we took out our first mortgage in 2001. I too thought this was a condition which was non- negotiable if you wanted a mortgage. I also shopped around last year and was shocked at the difference in cost of various companies policies. I had just accepted the increase each year in ours and renewed it without looking at others. I wish I had been more savvy as we have exactly the same cover now for significantly less cost with a different company.

Wheresthecoffee Fri 15-Nov-13 17:21:24

Life insurance is firmly on the to do list. I've tried to research it numerous times and always come away boggled.

My question to Louise would be 'for a non smoking couple in their mid thirties with DS 6 and DD 1, how should I go about finding the policy that is right for us? How do I know I am buying the right policy?'
Thank you!

BakerStreetSaxRift Fri 15-Nov-13 22:40:38

DP and both took out life cover (with Aviva, do I get extra points?!) when we bought our flat. We had the option of a level term or decreasing term. We went for a decreasing term as we have now DCs yet. If/when we do, I would want to take out another one. We both burn get good cover through our employers.

Critical illness cover is one I would really like to have, but it's just so much extra a month (£50 or so I think forus) and I just know if we did it, I'd get something that was in their list of exclusions and they'd refuse to pay out.

Cherryjellybean Mon 18-Nov-13 08:33:49

We don't have any life insurance, the quotes we were given when we looked into it last were quite a lot considering our age and good health. Dh has in service through work.

AnnMumsnet (MNHQ) Mon 18-Nov-13 13:57:48

Hello - thanks for all the comments. Pleased to say Steffanoid is the winner of the £150 high street voucher. Well done.

AnnMumsnet (MNHQ) Mon 18-Nov-13 13:59:45

Sorry forgot to say that the As to Qs selected from those posted on this thread will be added to this thread in the next few days.

Steffanoid Mon 18-Nov-13 14:31:56

thank you so much aviva and MNHQ smile

theignored Thu 21-Nov-13 11:30:09

We have life insurance through work to cover us both and also a seperate policy which would pay our mortgage off.

LouiseColley Thu 21-Nov-13 12:51:07

Roundles

When should I start panicking! 31, no children, no life insurance, but a partner of a similar age who I would hate to leave with nothing.

We are both on low-ish incomes, job security at the moment is an issue for both. Where do we start?

Thank you for your questions NotAFemenist and Roundles. There’s no right or wrong time to take out life insurance, (we even have a policy for the over 50’s) but as a guide, people often take it out when they have a ‘major life event’ – such as buying a house, moving in with a partner or having a child. 

As a general rule, premiums tend to be lower, the younger you are. So, now’s as good a time as any to start to think about your protection needs. Hopefully you’ll find a few good pointers on this page. I’d also recommend that you talk to a financial adviser about your needs. If you don’t already have one, you may find this link useful.

LouiseColley Thu 21-Nov-13 12:55:16

10thingsihateaboutpoo

We both have 3x salary cover at work and took out joint life policies after each DC was born so we're well covered in that respect.

I do think we ought to have some sort of critical illness policy but there seem to be so many options and i'm not sure of the ins and outs etc it's a bit daunting. I worry we'd end up paying a lot for the wrong thing.

Hi. Mumsbe and 10. (Sorry, it didnt feel quite right using your full name!) Its great to see that youve already taken steps to protect your family. As you say, you dont want to be paying for benefits that you dont need, so you may find it useful to have a chat to a financial adviser about this. If you dont already have one, you may find this link useful.

As a guide, heres a very brief description of some of the different types of family protection products available:

Life insurance: (also known as life cover or life assurance)
Designed to leave your loved ones a cash sum to help make it easier to maintain their lifestyle in the event of your death. The benefit paid through employer sponsored life insurance schemes is often referred to as death in service benefit.

Critical illness cover: Designed to pay a cash sum if youre diagnosed with one of the critical illnesses covered by your policy. This is often available as an optional extra on life insurance policies, so its worth checking whether its covered on your policy.

Income protection: Designed to pay you an amount each month if youre unable to work long-term due to illness or accidental injury. A monthly benefit, based on a proportion of your salary, is usually paid until you return to work, or reach the policy end date.

It goes without saying that its really important that you fully understand what your policy covers. The good news is that many insurers (including Aviva) are now writing their terms and conditions in Plain English, to help make it easier for you to understand your cover. However, insurance can still be complicated if youre unfamiliar with the products, so dont be afraid to continue to ask questions.

LouiseColley Thu 21-Nov-13 12:56:41

whattodoo

My DP has cover through his employer.

I have cover through 2 endowment policies, but probably not sufficient.

We really should get proper advice about what I'd best for us in terms of product and amount.

A question - does it matter that we aren't married? Our wedding is next year so would it make sense to wait until after then? We have a DD.

Hi. Its great that youre thinking about your protection needs. You dont need to be married to take out life insurance you simply need to ensure that your plan is set up in such a way that your DP will receive the benefits. Your financial adviser will be able to help you with this. Good luck with your wedding plans.

LouiseColley Thu 21-Nov-13 13:02:13

CrewElla

I have life insurance through my work, I believe that it's 2 times my salary, but that's it (I took advantage of the free £10000 from Aviva for baby's first year through Mumsnet page) but I'm not sure how much is enough. Is there a standard calculation based on salary, number of children you have, etc?

TBH it's not something that I really like to think about too much.

Hi Crewella, it’s great to see that you’ve got some protection through your employer and that you’ve also taken advantage of our £10,000 New Parent Free Life Cover.

The amount of life insurance cover you need will vary depending on your personal circumstances. A financial adviser will be able to help you work through your exact needs. However, to help you get started it may be useful to consider the following:

1. How much does your current lifestyle costs and what are the most important things for you to protect?

First work out how much you spend each month on bills (including debt, credit cards and loans), your mortgage/rent, family activities etc. Don’t forget to include things such as hobbies and all the other things that form part of your family’s routine. You’ll also need to consider the cost of child care if the main carer is no longer around.

You can use our lifestyle maintenance calculator to help you with this.

Next, prioritise your out-goings by asking yourself what would have the biggest impact on your loved ones if you were no longer able to afford it. For example, this could be your mortgage.

You’ll now have a clearer view on what’s ‘essential’ to protect versus what’s ‘nice to have.’ This in-turn will help you work out how much financial support you’d need to be able to maintain this.

2. What protection do you already have in place?

Think about any other benefits that you might be entitled to. For example, any Death in Service cover you have through your current employers. You may also be entitled to State benefit from the Government if you’re bereaved, but this will depend on your circumstances.

What other assets do you have e.g. savings. How far would these go?

3. Think about the finer details

Who do you want the policy to cover?
How long do you want the cover to last? For example, do you want it until you’ve paid off your mortgage, when the children leave home or perhaps when you retire?

This detail will help your financial adviser select the right product and level of cover for your personal circumstances.

LouiseColley Thu 21-Nov-13 14:45:13

Im covered through work do I need additional cover?

These days, many employers offer their employees life insurance cover as part of their employee benefits package. This is commonly referred to as Death in Service benefit. Typically Death in Service benefit provides a lump sum of around 4 x your salary to your nominated beneficiary if you die. This will however vary depending on your employer. Some employers may also include dependents pension benefit as part of their group life policy.

Death in service benefit can offer a great safety net if you die while working for your employer. However, depending on your personal circumstances you may benefit from additional cover.

Here are a couple of pointers that may be useful:

1. Many employers now offer life insurance as part of a Flexible Benefits scheme. This type of scheme usually allows you to increase the amount of life cover, income protection and critical illness cover your employer offers as standard. Its worth checking whether your employer has this type of arrangement in place and if so, when the window opens for you to review your cover. (This is usually annually.)

2. Death in service benefit is non-transferrable so if you leave the company youll lose the benefit.

3. As the level of benefit is based on your salary, if you reduce your hours, then benefit will be calculated on your pro-rata salary.

4. While life insurance is an extremely common employee benefit, fewer employers offer income protection or critical illness cover. Don’t assume you’ll have these too.

LouiseColley Thu 21-Nov-13 14:45:58

nextphase

Life insurance through work.
I wish people would stop assuming its a crap deal with work (7x salary, 11 for accidental death, and yes, I have got those numbers right), and trying to sell me more.

My question is, what happens if we change job. Will we get stung, as we are much older when taking out the policy?

Hi Nextphase, its great to see that your employer is offering you cover. Typically, company funded life insurance and accidental death cover policies are not portable. So, if you leave the company, its likely that youll lose the benefit.

Youre right that a persons age is one of the factors taken into account when insurers set life insurance premiums. Typically, premiums will be more expensive the later in life that you take out the policy. However, there are lots of different options available and if you find yourself in this situation, I suggest that you talk to a financial adviser who can help you to find the best option for you.

LouiseColley Thu 21-Nov-13 15:07:53

MissRee

I have 4x salary through my work and a life insurance policy on both myself and my partner which we took out when buying our house. My partner doesn't get a death in service benefit from his employer, should we be looking at something else to help me should anything happen to him?

We did have critical illness cover but I think the policy lapsed. I must dig out the paperwork for that and renew it!

Hi MissRee, based on what you say, it looks as though both you and your partner already have some protection through a personal life insurance policy. However, as you took it out when buying a house, you may want to check how much cover it offers you. People often align the benefit with their mortgage and if your circumstances have changed it’s worth reviewing your cover to ensure that it still suits your needs. I suggest that you have a chat to a financial adviser about this. They should also be able to help you decide what to do with your elusive critical illness policy!

MaddAddam Thu 21-Nov-13 15:13:26

No, we don't have it. We have mortgage insurance so the house would be paid for if one of us dies. Apart from that, we're both regular earners, each with a salary we could survive on, and reasonably employable. So it's likely that with one parent working and no mortgage we'd be OK.

It's a balance. Obviously it's a good thing to have life insurance, and especially important for some, e.g. if you have only one household earner etc but we've prioritised keeping 2 careers more or less on track as an insurance strategy.

LouiseColley Thu 21-Nov-13 15:21:42

WowOoo

We have life insurance and got it when we bought a house together many years ago. The next step was to have children, so it seemed sensible.

I also think that a lot of the small print and literature is very confusing and deliberately so.
I wish insurance companies would write in plain English.

Do you know if it's possible to change your life insurance provider? I shop around for all other types of insurance. Can I do the same for life insurance? I suppose I will have 'wasted' years of no claims..?

It’s good to hear that you already have some life insurance provision in place.

Yes, it is possible to switch life insurance provider – but make sure you understand whether there’s any implications if you do this. Here are a few pointers to help you:

1. Check whether you’ll be subject to any premium increases if you switch your policy, due to deterioration of health since you took out your policy or your age.

2. It’s important to compare life insurance products like-for-like. What might seem like a better deal might not provide you with sufficient cover for your personal circumstances.

3. Ask your life insurance provider if you can amend your cover for more or less protection, depending on your circumstances. Not all policies will allow this and it may be cheaper to maintain your current policy and apply for additional cover with another provider, as some policies have guaranteed rates and premiums generally increase with a person’s age.

That’s not to say that there may not be a better deal out there for you. Just make sure that you seek the right advice before you make the change. A financial adviser should be able to help you. Finally, life insurance doesn’t have a ‘no claim bonus’ like car and home insurance– so don’t worry, you haven’t wasted years’ no claims.

LouiseColley Thu 21-Nov-13 15:30:12

Cucumberscarecrow

I tried to take out life assurance before but was completely daunted by the level of medical background required. I am fit and healthy in my late 30's but don't know what my great-grandmother died of and whether my diagnosis with borderline asthma 18 years ago following some time in smoggy Mexico City was relevant and whether there were other minor things I was forgetting but whose omission would void the policy. I gave up.

In other words, I really want insurance but am terrified by the burden of the application process. Can Aviva help simplify this or give tips on how best to deal with it?

You’ll be pleased to know that many insurers (including Aviva) have taken steps to make the application process simpler. For example, we’ve written our health and lifestyle questions in Plain English so they’re easy to understand. By asking clear questions, we can accept the majority of people immediately for life insurance and at the premium quoted. Occasionally, we may need to request further information; either from you or your doctor as part of the application process. Then depending on medical history we may need to increase the premium.

I am sorry that you are terrified by the burden of the application process, you obviously recognise the value of protecting your family and there really is no need to be daunted as we dont need to know what your great-grandmother died of and your borderline mild asthma is unlikely to be of any concern.

LouiseColley Thu 21-Nov-13 15:32:35

mamof3boys

We haven't got life insurance, although I know that we should. We did try to apply for it a few years ago but I'm not sure what happened to the application. My husband had cancer around 15 years ago so I'm not sure if that affected it?

It really is something that I need to look into as we have 3 children, but to be honest, I'm not really sure where to start. There just seems to be so many different options and it confuses me.

A history of cancer 15 or 20 years ago with no recurrence would usually be acceptable and wouldn’t prevent life insurance being taken out.

LouiseColley Thu 21-Nov-13 15:33:09

WhisperingPea

We've both got life insurance taken out 16 years ago when our daughter was born; one is straight life assurance the other would pay a set amount each month. They both end in less than 2 years and we're wondering what to do at that point. The house is paid for and we've savings that would support her for a good few years. Does Aviva have any advice?

Thank you for your question. Unfortunately I’m only able to offer general guidance so the best piece of advice I can give you is to speak to a financial adviser. They’ll be able to review your circumstances and suggest the best course of action.

LouiseColley Thu 21-Nov-13 15:38:28

AndHarry

Questions:

- Is there any way to make sure that if I died and DH remarried and then died before his new spouse, our children would receive some of my payout? I wouldn't want to leave it in trust to them as I can imagine a lot would be needed to pay for childcare and other expenses but I wouldn't want them left unprovided for either.

- The thing that puts me off getting additional critical illness/injury cover is that it seems that insurance companies try very hard to not pay out. Can you talk a bit about that please?

Hi AndHarry. There are ways of ensuring that your children would be protected in this circumstance. I suggest that you seek financial and/or legal advice to ensure that the relevant instructions are in place.

It saddens me that people still think insurance companies try to avoid paying critical illness claims, when in reality we pay the vast majority of claims and we much prefer telling people that their claim has been paid. We publish our claims figures every year and last year we paid out 99.3% of life insurance claims and 92.5% of critical illness claims. My top two tips are; make sure you fully complete the application form, and if in any doubt speak to your provider or financial adviser.

LouiseColley Thu 21-Nov-13 15:46:52

Yogagirl17

Should I still be paying my ex-husband's life insurance? It's designed to cover the mortgage for the house I'm still living in so maybe I should..?

Thank you for your question. Unfortunately, I’m unable to give you an answer as there are quite a few unknowns – such as who is responsible for the mortgage payments. It’s certainly worth you speaking to a financial adviser about this though.

LouiseColley Thu 21-Nov-13 15:47:50

AntoinetteCosway

We have life insurance through Aviva. What I am terribly confused by is the trust element. We'd like to write it into trust but there's no indication of whether a trustee can be a beneficiary, and when I've phoned Aviva to ask they just say they can't help. Great! Would also like to know how to deal with future children. For instance, can I make DH both trustee and beneficiary so he can dole it out as appropriate to DD and hypothetical future children? Why can't I put future children on it-why do beneficiaries have to be named specifically? I know we need to go and see a solicitor about this but we don't have a spare £500 and it's driving me nuts. that something so easy is made so difficult by such a stupid form.

Hi Antoinette. Its great to see youre considering using a Trust to distribute the proceeds of your plan to ensure the money gets distributed as youd want. However, this can be complicated so you should make sure you speak to a financial adviser so you fully understand the terms of the policy.

OPeaches Sun 24-Nov-13 11:05:43

We have life insurance simply because the financial advisor who helped us with our mortgage arranged it. I actually has no idea how much we are insured for, but I remember he got us to change it once we had kids.

We son have critical illness cover, purely because it was so expensive and I've heard so many stories of companies finding ways not to pay out. We weighed up the odds and decided not to. Fingers crossed we'll never come to. Regret that decision.

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