Life Insurance question

[flywiththecrows]

I am looking at life insurance right now. because twice in the last week some eejit has nearly run me off the road and it got me thinking about security for SAHD DH & DD in the event of my death.

I'm 30 and have asked for a quote based on a policy term of 40 years (this was the maximum term)

So, I suppose my question is this:

When the term is up and I'm still alive (i.e I'm 70 yrs old) is that it? Has my policy ended? I know I don't get a pay out, but would it be easy to just renew? (as this current policy I'm looking at states that you need to be over 18 and under 59 to start a policy)

Sorry if I haven't explained myself properly

It'll be expensive to get life insurance once you are 70, as the probability of them having to pay out is going to increase every year from then on. On the plus side, your husband will have a pension and your children will be grown up and not need your financial support, so there's a question of why you'd need insurance by then.

I have a policy that only pays out on my death and as long as I keep paying the premiums I keep the cover. It is called a whole of life policy and I got it from Legal & General.

It has no investment benefits attached to it - only pays if I die and it is the cheapest form of life insurance you can buy. The type of insurance you are being sold is called term insurance and is for a fixed term like 20, 30, 40 years. It is more expensive and generates a bigger commisison for the sales person.

See a brief explanation of the two different types here.

I also have a seperate but much smaller critical illness cover to pay bills if I get very ill but dont die immediately.

thanks for the responses. I did reply last night but when I posted my laptop 'hung'

I like the idea of the whole of life policy, I think I'll investigate that a little further.

:)

Presumably though, two whole of life policies (one each) helps with IHT planning, and may provide money towards the funeral of the first to die and care for the survivor, especially when older. The second death then provides money for their funeral and to settle IHT liabilities, (if written in trust).

scary - yes but the policy has to be written in trust as well or the proceeds of the insurance payout become the property of the estate of the deceased and they become subject to IHT.

My policy pays to a trust that DW and DSs are beneficiaries of.