Three important questions to ask when you take out life insurance
Life insurance is a product that ultimately you never want to talk about. It is, however, important to put something in place just in case the unimaginable happens. Although you will hope you never use it, you should ensure that you do your research so you get the best policy available for your family. When researching life insurance ask yourself the following questions:
- Do I really need life insurance?
If you have a family or dependents then it is a good idea to take out life insurance. Having peace of mind that those you love will be taken care of when you pass away will allow you to sleep easy. If, however, you do not have dependents, life insurance is not always deemed necessary.
- When is the best time to take out life insurance?
When you go through certain changes in circumstances you should always take a view on your finances and policies. Life insurance should be looked at during this time too. Have you just become a parent? Have you just got married? Have you had a substantial pay rise? Have you just purchased a house? If you answer 'yes' to any of these questions then you should investigate life insurance.
- How much life insurance cover do I need?
You should try and obtain life insurance so that your dependents are able to maintain their standard of living after you have gone. A ballpark figure is typically ten times your current salary, although if you do not have children this could be slightly less.
As with all insurance you must do your research properly and ensure you read all the terms and conditions so you know what you are getting yourself into.