Many new parents begin thinking about life insurance when their baby is born. It’s natural to be concerned about providing for your children in case a time comes when you’re not around.
However, most new parents are battling sleep deprivation whilst caring for the round-the-clock needs of a newborn and with so many different life insurance policies on the market, it can seem like a daunting task to sift through them all.
Which is where Bobatoo can help. As well as working with a host of top life insurance companies to help find you the best policy, we are also currently offering a special deal for new parents: get £10,000 of free life insurance cover for the first year of your child's life.
Do You Really Need Life Insurance?
Maybe you’ve been saving for years, or maybe your employer offers a very significant death-in-service payout and you’re wondering if you really need the extra expense of life insurance. It isn’t advisable to rely on either of these things, or on the generosity of relatives.
There may be other family emergencies in the future that might require you to dip into your savings. You may lose your death-in-service benefit through redundancy or changing jobs and the circumstances of relatives you’ve entrusted to take over caring for your child and they may change meaning they can no longer provide care in the event of your death.
After the birth of your first child is a good time to take out life insurance. The longer you put it off, the more likely you are to experience health problems that might push up your premiums or cause you to be declined altogether.
How Much Cover do I Need?
Many factors will need to be taken into account in order to personalise your policy.
Depending on your circumstances, you can opt for a policy that pays out a lump sum, or ongoing financial support, or both. You may opt for a policy that pays out a lump sum to clear a mortgage or any debts that may be outstanding and then continues to provide a regular source of income for your beneficiaries.
You should speak to a specialist advisor to settle on a policy that takes into account your individual circumstances.
You’ll need to decide how much you can afford to pay, how long the term should be and whether you should take out a joint policy or insure both you and your partner separately. You might also wish to consider index-linking your insurance so that it doesn’t devalue with inflation.
What About Illness Cover?
If you can afford to take out illness cover as well as life insurance, it’s highly recommended, as you are nearly seven times more likely to suffer serious illness during your career than to pass away.
Whichever kind of life or illness insurance you’re considering, the best approach is to speak to an adviser who can explain all of the available options and create a plan that is personalised to your needs, giving you peace of mind that your family will be provided for.