Life Insurance
By Rachel Lane, Fri Dec 9th
Contemplating what may happen to your wife (or husband) andchildren if you die is not likely to be a thought you wish tocontemplate. However, avoiding the issue may make life moredifficult for your family after your death.
Life insurance looks set to make a comeback in the UK, after aperiod of neglect by consumers who were simply occupied withaffording a home. The stabilising of the UK house market hasmade many consumers take a broader view to their personalfinances.
LifeSearch (a life insurance broker), in the September issue ofMoney Observer, highlighted a few common mistakes people makewhen buying life insurance:
* Believing life insurance is relevant to everyone Lifeinsurance is only relevant to people who have financialdependents. If you have no financial dependents, it might bemore appropriate to consider income protection or criticalillness insurance.
* Paying too much for life insurance According to MoneyObserver, research for Sainsbury’s Bank life insurance revealedthat many people take life insurance policies from theirmortgage providers and as a result could be paying too much.
* Opting to buy joint life insurance policies instead of singlelife insurance policies The advice to married couples is toavoid taking out joint life insurance policies which pay outwhen the first spouse dies over the term of the policy, but noton the second. Single policies could provide additional cover bypaying just an extra £3-4 a month.
* Missing out on a trust The Tax Man can claim up