The most common reason for investing in life assurance will be to cover a mortgage but it is also part of the review we all undertake, perhaps after getting married or, more likely, when we have children.
For a single person with no dependents, life assurance may not be necessary. If you have debts and no savings, then a small amount might be necessary to pay expenses and prevent someone else being landed with those debts. There is also an argument that you should cover a mortgage but in this case, if you are happy to pass the property back to the bank, or if your beneficiaries are more than able to cover mortgage payments whilst the house is sold, then there is probably no need for it.
If you have dependents, however, you need to look at the consequences for them if your income ceased. How much do you earn? Do you have debts? How much is your mortgage or rent? Do you pay school fees? How long before your children will be working? Does your partner work? Could they continue to do so without your support? Even if you don’t work, there can be a considerable cost involved in replacing your income, to look after children and/or the house. Finally, life assurance can be used to help in inheritance tax planning. Remember as independent financial advisers we can search the whole of the market to find the most competetive quote, tailored to your exact requirements.
