Life Insurance Made Simple | Nationwide Building Society


Life insurance is a way of helping your
loved one’s if you’re no longer around. It works just like any other insurance
policy, you simply pay a premium each month and if the worst happens, and
there’s a valid claim, your policy kicks in and your family or dependents are given financial support to help cover anything from the monthly bills to clearing any
debts you might leave behind, or even helping to pay off your mortgage. There
are two main types of life insurance, the first is called term life insurance and
this runs for a fixed period of time known as the term. For example it could
be five, ten or even twenty five years. The way it works is if you were to die
during this term the policy would pay out as long as you’ve kept up your
monthly payments and make a valid claim. Or if you don’t die, it would simply
come to an end with no cash value. The second type of life insurance is
known as whole of life policy which pays out no matter when you die so long as you’ve kept up your monthly payments and make a valid claim. This is generally more expensive
than term life insurance though, however, you may find life insurance costs less
each month than you think and it’s worth bearing in mind that it’s usually
cheaper to take out a policy when you’re younger than start one later in life when
the monthly premiums are likely to be higher. Then the next thing to think
about is how much cover you actually need, in other words, how much money would help your loved ones if you were to die. To help work this out, start by totting up
any outstanding debts or bills they’d be left with, in that figure include any
big debts like a mortgage, plus monthly outgoings and other costs that might
come up in the future like university fees. It’s worth getting
financial advice from a professional if you are unsure about anything then, when
you’re done, you can sit back and relax knowing you’ve put some plans in place.

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