I’m single and don’t need life insurance
Even if you don’t have dependents, it’s important to consider the financial implications your loved ones or extended family might be faced with after your death. Over 50s life insurance can help towards personal debts that you leave behind and the cost of your funeral – liabilities that don’t take care of themselves. It can also be used to leave a a legacy to your favourite charity or cause if this has ever crossed your mind.
If you have a pre-existing illness, you cannot get life insurance
This is true with certain life insurance policies, but not so for over 50s life insurance as a medical is not required. This of course does make it slightly more expensive than other sorts of policies.
I’m too young to worry about life insurance
It actually makes the most sense to purchase life insurance when you’re younger, as your premiums will be cheaper. The longer you wait, the more expensive your premiums are likely to be. This is because as we age, a claim is more likely, so you’re deemed as higher risk.
I don’t need protection to pay for my funeral, the state will pay
The criteria for a state paid funeral is very strict, and is likely to become more so as budgets tighten. Even if you do qualify, it’s likely to be very basic. Having some provisions in place to help towards the cost is better than nothing at all. Making arrangements for your final passing can also ensure that your life is celebrated in the way you want.
The claims may not be paid out
Only a minor number of policies are not paid out – the amount of claims paid is higher than ever. ABI reported that 99.9 % of all whole of life insurance claims were paid in 2013.
These are just a small number of misunderstandings about life insurance. Whatever decision you do make, make sure you do your research. If you’re having difficulties trying to get your head around over 50s life insurance, take a peek at our jargon buster infographic which breaks down key phrases you’ll come across when researching the product.
1 FT Adviser, (May 2014) “ABI insurers paid out of protection claims” [online]. Available from www.ftadviser.com
Note: Whilst we take care to ensure Hub content is accurate at the time of publication, individual circumstances can differ so please don’t rely on it when making financial decisions. OneFamily do not provide advice so it may be worth speaking to an independent financial advisor about your own circumstances.