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AIBU?

Share your dilemmas and get honest opinions from other Mumsnetters.

Original poster

To think if you have children you should have life insurance?

148 replies

JustAnotherManicMummy · 14/12/2009 13:14

Just to be clear I am talking about people who can get cover and who have an income/lifestyle to potect but who choose not to spend a few quid per month protecting their family should they die (ie not people with conditions that mean they can't get cover/those without a spare penny and who really do live on the breadline etc)

I am confused as to why someone would insure their car/possessions but not their family's livelyhood?

I work in finance so I find it easy to speak plainly about this - but also because I have seen the consequences of people not taking out cover and something terrible happening. It is heartbreaking.

I can give you an example of what I'm talking about: BIL's wife is from overseas. She is not entitled to claim any benefits and does not work (can't get a job where she lives and needs to look after their pre-school DD). He owns a property which is mortgaged. He will not take out life insurance, despite the fact he is the sole provider for that family and if he died there would be less than £10,000 for his wife and child to live off after his debt has been repaid. I think he is irresponsible.

So, AIBU?

OP posts:
mistletoekisses · 14/12/2009 13:16

I thought banks made you take out life insurance if you have a mortgage?

Original poster
JustAnotherManicMummy · 14/12/2009 13:20

No they don't. They can't in fact.

OP posts:
tinierclanger · 14/12/2009 13:20

Well, we don't have private life cover, but we have some through our pensions. Are we included in your definition or not? We've got enough to pay off the mortgage and probably live on for a bit.

I think YABU, but also YANBU. Everyone's circumstances are different and everyone should THINK about it, but it may not be as necessary for some as others.

QueenOfFlamingEverything · 14/12/2009 13:21

I have no income other than state benefits atm.

I have no mortage.

I have no car.

I have no possessions worth insuring. The majority of what we own was either second hand or out of a skip.

I can hardly afford to pay for basic essentials such as the gas bill.

Do forgive me for not making a priorty of life insurance - my life basically has no financial value whatsoever.

chocolaterabbit · 14/12/2009 13:21

I was all ready to say YABU until i saw yuour discvlaimer as no company in the world will insure my DH's life . Many people though have life insurance through work so don't need to take out a seperate policy, Bamnks only want to know how you will repay the mortgage if one/both of you die - you don't have to have life insurance to have a mortgage

OhChristmasTEEOhChristmasTEE · 14/12/2009 13:21

YANBU.

Everyone with kids should have life insurance and a will stating guardianship of said kids should something happen to both parents.

ButterPie · 14/12/2009 13:22

Repost as it is more relavant here:

But my income is entirely from the state (tax credits, DLA and child benefit) and DP is on minimum wage, so surely if the worst happened, the kids would be provided for in the same way? In fact, they would probably be better off, money wise, as both sets of grandparents have decent incomes.

We don't have any insurance for anything, tbh. Don't own a house or car. Really probably should look into insuring the contents, but our only valuables are our £200 TV and our two computers, which didn't cost us anything as they were donated and inherited, but are probably worth a total of about £300.

I tried to look into insurance online, but couldn't get a quote as we rent our house. Any idea what kind of price range we are looking at? And, while we are at it, how much would life insurance be? Two healthy people, I am in my mid twenties, DP in his mid thirties, DP smokes but apart from that we are low risk. How much are we worth insuring for? We have two children, but no assets, and all our parents are still healthy and could take on the kids, plus I have two sisters who could do the same, one of which is reasonably well off as she is a teacher. Would be nice to leave them something, but I am not about to struggle to pay bills now because of it.

fluffles · 14/12/2009 13:22

no, banks don't make you.

i don't have any and i have a mortgage (but i have no children yet and am not the main earner - dp could survive without my wage and we live in his flat).

if my flat went into further into negative equity than my savings then i'd probably take some out so as not to leave DP with debts when we marry (next year).

Original poster
JustAnotherManicMummy · 14/12/2009 13:23

Queen you are in the exception bit - ie no income other than benefits. Would not think you irresponsible.

OP posts:
nannynobnobs · 14/12/2009 13:24

I have life/serious illness insurance through my bank, it costs a tenner a month and covers pretty much every sort of health crisis.

AngryFromManchester · 14/12/2009 13:24

We have to pay £140 p/m life insurance for both of us and tbh it is a struggle to pay it most months but we do

I don't know if you are being reasonable or unreasonable but I can see why someone may want to spend that 100 odd quid on something else.

Original poster
JustAnotherManicMummy · 14/12/2009 13:25

For those of you with protection linked to your jobs... what would you do if you lost that job?

OP posts:
Malificence · 14/12/2009 13:25

He is being hugely irresponsible.

I think that 5 years' salary after the mortgage is repaid should be a mimimum requirement.

Paying the mortgage just isn't enough imho, especially with young children.
I'd go even farther and suggest critical illness and disability cover as being essential too.

SprocketAndTubbs · 14/12/2009 13:26

I have life insurance, however I am a single mum to a DS (7) and have a lot of equity in my house. A while back it was suggested to me that I didn't need the insurance as if I died, the house would be sold and DS would live with my next of kin and have the profit from the property when he gets older.

Having said that, I understand that, although it can be quite cheap, some families simply can not afford the monthly premium for life assurance.

A lot of people don't like to think about the worst happening to them - the same reason as many people don't have a will, it's something that people put off until the next month, assuming that it will never happen to them.

My employers also offer life insurance as part of my perks and I think a lot of companies do similar things?

RealityIsHungover · 14/12/2009 13:26

This reply has been deleted

Message withdrawn

SparklyGothKat · 14/12/2009 13:28

I am on benifits as DS1 and DD1 are disabled, but I pay £7 a month f life insurance. If I die before DS2 is 16, they pay a lump sum each month to the kids

tinierclanger · 14/12/2009 13:30

If I lost or changed job, I'd take out life insurance, if I could afford it. Why would I pay for it in advance if I don't need it though? Puzzled?!

Morloth · 14/12/2009 13:32

I am pretty keen on insurance, it always seems very expensive until you need it when suddenly it becomes very cheap.

Debs75 · 14/12/2009 13:34

I think you are right. DP and I both have life and critical illness cover. We have 3 DC's one of whom is disabled.
Our income is mainly made up of DLA. CTC and child benefit. When Dp is working then it is only minimum wage.
If both of us died then my sis would have all three kids (plus her own) the money from the policy would help them get a larger house and enable her to give up work to care for our baby.
If juyst one of us dies or are critically ill we would look into using the money to buy our council house as that would give the kids longstanding security.

We don't pay through the nose for our insurance as we got it when we were young (mid 20's). Mine is less then our contents.

If you are really struggling to pay bills and feed your famliy then it isn't a priority

Butterpie We got ours from Scottish Widow and pay roughly 450 a year. Go on money supermarket to find a good deal

wannaBe · 14/12/2009 13:34

it is IMO incredibly selfish not to make provision for your children.

It is also IMO selfish not to appoint legal guardians in the event of your death.

tinierclanger · 14/12/2009 13:34

Some insurances are important. Others, people would be better off saving the money.

chocolaterabbit · 14/12/2009 13:34

DH and I both depend on job related insurance. If we lost those jobs, we would have to find something else - both professionally qualified and experienced so usually employable even at the moment. We are also careful not ever to take on expense which can't be covered on a single salary and we're trying to get mortgage free as quickly as possible. Malifence - some people cannot get disability cover at all and it is often horrendously expensive and tries hard not to pay out. You might want to think about some exclusions to your blanket statement.

ThumbleBells · 14/12/2009 13:35

God, I have life insurance and critical illness cover to the tune of over £100 a month, most of it to do with my mortgage endowment policies (sure I was screwed somewhere along the line but can't in all honesty say it was mis-sold to me ). If I died, my mortgage would be paid off and DH & DS would have the house in the UK as equity.

However, DH still does not have life insurance and it is peeing me right off - he must get some, and a Will (I must also do a Will) because we would be left in a desperately tenuous position if anything were to happen to him; not least because I am only on a temporary spousal visa here in Australia, so for starters that would probably be revoked (DH is my sponsor).

MsDoctor · 14/12/2009 13:36

WE don't have life insurance because we think food is more important! Although DH owns the house and has a little life insurance.

Mishy1234 · 14/12/2009 13:37

I thought you had to have life insurance if you had a mortgage.

I agree with the OP that you should make adequate provision for your family to continue to live in the family home and maintain their lifestyle in the event of your death. I also think that critical illness/disability insurance is a very good idea if you can afford it.

Most people have death in service benefit through their jobs, but that sometimes doesn't come into play if you move jobs, so I would rather have private insurance in place too.

Insurance IS expensive and not everyone can afford it, especially with families to support. However, if you do have a mortgage, the insurance aspect should be factored into your calculation for how much you have to spend.

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