Life Insurance. Exciting Topic here.......

[MotherFunk]

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THere is alot of levels - terminal, accidents etc. and cancer. I don't they pay out if nothing happens though, that's how they make their money.

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ah yes, critical illness, is that the terminal one? ie. if you are going to die within a year (I think) they pay out then, before you die. Yes, they keep it. Some pay out but I think it's the over 60 type ones, so they still can make money.

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I think that's right. You're paying for the peace of mind.

I am pregnant at the moment, and my husband carries enough life insurance that if anything did happen to him, the house would be paid off, I wouldn't have to go back to work until the child started school, and school/university fees would be completely covered.

Basically I would be in deep enough emotional shit that I couldn't deal with deep financial shit as well.

Yep, you're hoping that it's a policy that you'll never use. £10 a week seems like a lot. Is there a reason why you need a £700,000 pay out? That's a lot of money! Do you have a policy for the mortgage already?
The maximum amount that most people go for is 10 times the main salary-earner's income. The idea is that it's to cushion the financial blow of losing a parent, not to provide a windfall for the child, IYSWIM. The actual value of the payout will be eaten away by inflation, but as the years go by, the amount of time that a child will need the extra financial support will decrease too, so it all evens out. The value of the £10 a week (or whatever) decreases too (or at least it should, you should make sure that you get a fixed-premium product).
Critical illness insurance is a bit of a contraversial area. It only covers you for specific illnesses, so if you happen to get something not on the list - no payout, and it's expensive. Personally, I don't think it's worth it.

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If your son is under 21, then the money fomr a life insurance policy would go towards the things that you would normally pay for him - general living expenses, driving lessons, university, that sort of thing. If you have enough savings to cover all his needs, or he's old enough to look after himself, then you don't need life insurance.
In my case, even though I don't work at the moment, our DD is only 1, so if I suddenly died DH would have to find money for childcare, plus deal with never having an income from me (I plan to go back to work when DD is in school, maybe sooner). So for us it's well worth it. I'm astonished to say the least that an agent quoted you £700,000, especially as it wouldn't have to cover a mortgage. Sounds like he would get a fat commission to me. There are plenty of cheaper ways of getting sufficient cover.

I would recommend LifeSearch to find you competitive life insurance. They are brokers that I went through recently and I was impressed with their service. Life insurance is very cheap compared to critical illness. You should be able to get £200k for less than £10 a month depending on your individual circumstances.

I used LifeSearch too - they were really good especially as I have problems getting some form of insurance for health problems.

Insurance is not an investment vehicle (although some to pay off a small amount at the end of the polivy)

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I can understand that it doesn't seem fair to pay into a product that probably won't pay anything back, but it's because you get a lot more money if you do need it than you could get from saving the same amount. I obviously don't know your personal financial details, but for us it would take a long time to save up £620,000 (our total cover for both of us). While we were building up the savings, DD wouldn't be protected. If we were both killed in a car accident tomorrow, then DD would get all the money she needed (or rather, the financial trustees that we appointed would).
I think it's quite common, by the way, to tend to over-insure, because we like to think that it would be nice for our loved-ones to have cash as a compensation for not having us around. It doesn't really make financial sense though, for the very reasons that you state - you only use it if the very worst happens.