If you want to make sure your family has financial security if the worst was to happen, you may wish to consider some further options, some of these include:
Critical illness cover – not usually offered as a stand-alone product – getting critical illness cover as an extra to your policy could prove invaluable if you were to become ill. This extra will give you a pay-out if you are diagnosed with a listed critical illness during your policy term.
If you have critical illness cover combined as part of your standard life insurance policy you will only get one pay-out and this will either be when you’re diagnosed as being critically ill – or when you die. It won't pay-out on both.
Some insurers will also offer children’s critical illness cover, which can be added onto a parent or guardian’s life insurance as an extra. This could cover the cost of looking after your child or any medical bills that could occur if the worst were to happen and they become critically ill. You would get a tax free pay-out at the time of diagnosis to give your family financial support.
A policy in trust – a life insurance pay-out is usually tax free, however if your policy isn’t written in trust your family might be liable to pay inheritance tax on any payment they receive. You should speak to your insurer and they should be able to guide you on the paperwork - this should be at no additional cost to your policy.
Comparing life insurance – different insurers offer different policies, your best bet is to compare life insurance policies and decide which is best for you and your family – or if you’d rather speak to one of our UK-based specialist call 0800 652 9754.