New parents celebrating a new arrival can often neglect to plan for the future, especially if the worst happens and a parent dies. Sainsbury’s Finance can provide cover to secure a family’s future.
New baby? Consider life insurance cover
Are you celebrating a new arrival? Bringing a new baby into the world is an amazing life-changing event, and a huge financial commitment.
Yet to most new parents, getting settled with a new baby means working out how to function on three hours’ sleep a night, and finding out what will get rid of a wide array of new stains. As a result, some understandably put their family’s long-term financial security at risk by failing to consider the need for life insurance.
Once you become a parent, it’s important to consider what the financial impact would be if you or your partner were to die. Would your dependents be well provided for?
Even if you already have existing life insurance cover, the arrival of a new baby is a key reason to review what you hold and to consider increasing the sum insured if necessary. After all, it is possible that a mother’s earnings may also diminish if time is taken off work and there is more reliance on a partner’s income.
While you may have some life insurance cover through your employer, that may not be enough. If you are healthy, these group policies may not be much cheaper for you than an individual policy, and they generally aren’t portable. So if you lose your job, you lose your life insurance.
How much insurance do you need?
You can use online calculators to help work this out and get a life insurance quotation. Some considerations may include, say, a stay-at-home spouse whose premature death may mean having to hire full-time childcare. This can be factored into your life insurance premium.
For new parents, level term insurance may be an attractive option. This is often the most straight forward type of life insurance policy, which can pay out a lump sum if you die within the specified term. You could, for instance, choose a term that lasts until your dependants are through education and no longer in need of your financial support.
Choosing a policy
Although money may be tight for many people right now, and a baby puts even more strain on finances, life insurance is often highly affordable and it is simple to do a life insurance comparison online.
There are many types of products available when it comes to life insurance policies so it’s important to think about the kind of cover you’ll need now that you have a child or children to think about.
You may want to pick a single life policy or a joint life policy. A joint life policy may be more cost effective, but if you earn considerably more than your partner, single life policies may be better to match the shortfall more effectively.
An additional form of insurance is critical illness cover and can be added to your life cover. This can pay out a cash lump sum if you are diagnosed with one of a number of pre-defined serious illnesses or conditions. This sum of money could be used to pay off your mortgage or help with unexpected financial consequences of being ill.