Life insurance?

[purpleme12]

If I want to look at getting life insurance (and critical illness cover maybe? I'm really not sure)
For my mortgage
What do I do??
How do I go about this?
Who should i go to??

And will they ask lots of questions about my health?? Even quite private questions??

And what price do people pay for this?

You are looking for an independent financial advisor. You'll have to answer medical questions for most insurances of that type, yes but they will be used to seeing all sorts of answers and will be bound by confidentiality. Perhaps ask a few friends locally for recommendations?

You need to talk to an IFA. There are so many variables. Yes, you will be asked medical questions but if these raise any issues, the insurer will probably want to talk to your GP (or, if the amount insured is large enough) get you to see their own doctor).

Oh right I didn't know they might want to speak to my doctor!

Generally you don’t need an IFA.

If you know how much cover you want then you can use one of the comparison websites and they’ll give you lots of quotes. It gets more tricky the more complex your medical history. They do write to your GP generally. They need to do a risk assessment to cover themselves.

Oh ok
I don't think my medical history is complex?
So when you mention how much cover, do I put in there how much my mortgage is for? Is that how it works?

I have life insurance through my work. Check with HR if you do too.

I also have a personal life assurance policy with L&G. I pay roughly £125/yr for a £125k policy that expires when I'm 60.

If you use one of the price comparison websites that'll give you an idea. They didn't ask to speak to my GP.

If you are considering critical illness cover, consider income protection insurance too. Be honest about any illness/condition.

Why do you think you need this? Do you have a DP/DH and/or DC?

What is critical illness cover Vs income protection?

I was just thinking because I'm buying a house and what if I die or become too poorly to work. Yes I have a child

That's interesting about work. I could ask HR

Do you have a will? If not, get one written ASAP.

If you do have a workplace policy, ensure you tell them who you'd like the money to go to. This is likely to be held "in Trust" until your DC is 18. Who do you want to be a Trustee?

Critical illness will pay out if you are diagnosed as having a life terminating illness. Depending on the policy, there could be a LOT of exclusions. You might think "cancer" would be covered, but depending on the type of cancer, people do react positively to treatment and live for years and years afterwards for example.

Income protection pays you a "wage" for a period of time if you are not able to work due to illness / unemployment - although with COVID, it might be harder to get the unemployment benefits on a policy now.

There is a separate "Money" board if you have more specific questions with very knowledgeable MNs.

Oh gosh this is complicated

It's just me and my child so my child would get what is here if I died

Take it all just one step at a time. You're right to be thinking about this but take time to ensure you make the right decisions for you / DC.

Do you have a Will and have you stated your views on who will be DC's guardian?

Check with HR your sick pay policy. In the NHS for example, I believe long serving staff get 6 months on full pay then 6 months on half pay.

Also what DC might get as a dependent from your pension.

Income Protection is arguably taken out by high earners who can afford the premiums but not a substantial drop in earnings.

If you only want it to cover your mortgage should you die, you can get 'decreasing term assurance' which is the cheapest kind; as the amount it pays out decreases as your mortgage loan decreases.

www.which.co.uk/money/insurance/life-insurance/types-of-life-insurance-policy-az4452w0rm82

Like many things you can do yourself online or see a specialist and get advice. You sound unsure and in need of advice. It won’t cost you anything to seek advice and you may even find an adviser can undercut the premium you would pay online. Advisers will be paid via commission from the provider, you won’t have to pay a fee. Speaking as an Independent adviser we can undercut prices offered by online comparison sites and actually give you advice, which you wouldn’t receive online. Basic life cover is relatively cheap, critical illness and income protection is more expensive. It’s about getting a balance between the right level of cover and affordability. You will have to answer a medical questionnaire, only sometimes there will be a requirement to contact your doctor for access to your medical records or have a medical screening. For a standard healthy person though this wouldn’t be a requirement.

Please don't be overwhelmed by this. A local mortgage / financial adviser should be able to help you source the right policy and their time shouldn't be of any cost to you.

There are lots and lots of policy and pay out types, some will offer a fixed amount payout (level term), others are linked to the balance of your mortgage (decreasing term). You'll also be on advised on different options for critical illness cover.

Policy price will depend on your medical history and age, you younger you are when you take out the policy, the cheaper the monthly payments will be.

I would always advise you to have some element of critical illness cover. Although it's great to know that in the event of your death your mortgage will be paid and your child will have a home, life for those around you will have to go on. Should you become critically ill, life will stand still, it's great to know that you'll get a lump sum payout that will cover your standards of living for a while should you not be able to work due to an illness. A lot of the time you can get a combination policy so say you got cancer and recovered, your critical illness cover would pay out and the life element would continue to run.

There's so much to consider here OP, I'd thoroughly suggest speaking to a local broker.

Thank you everyone

If I die she'd just go to live with her dad