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Choosing The Right Insurance Policy As Parents

Life Insurance for Mums

In today’s society, in the main, it still tends to be mum who stays at home to bring up their newborn son or daughter rather than dad. Some women go back to work after a few weeks, others take their full maternity leave before going back into the office, some will spend the first few years of their child’s life caring for them at home before returning to work in some capacity and other women may decide never to return to paid employment again. So, what part can life insurance potentially assist in the care of your child and how should you handle it as parents?

Well, ask yourself these questions. If you are a mum caring for your one year old child at home who would look after him or her if you were to die, would there be any additional cost involved and how would that expense be met? If that has got you thinking then read on…

Married Mum

Imagine a scenario where you and your husband both have well paid jobs, you get pregnant, give birth and you decide to leave your career behind for two or three years so that you can look after your much loved young child. It was then your intention that your sibling would attend a day nursery before starting their education at a local private school as a day pupil at five years of age. You are able to do this because you are in the fortunate position of being able to live on your husband’s income alone.

However, six months after the birth of your child, you receive the devastating news from your doctor that you have been diagnosed with terminal cancer and only have months left to live. Sadly you pass away nine months later. Your husband is now not only having to cope with bereavement but is faced with having to make some decisions surrounding the care of the child. For instance, does he want to give up work to bring up the little one for an extended period of time? However, he quickly comes to the conclusion that he wants to continue on his successful career path and will need to make a decision about the care arrangements for the little one.

So, who else could look after the child whilst he is at work? What about your parents or his parents or perhaps a sister? If one of these is not an achievable option then he will need to consider other forms of professional care such as a child minder or a day nursery. The problem is that such care is costly and needs to be paid for in some way.

By planning in advance, this is where term life insurance could help towards the cost of caring for your young son or daughter. Let us explain…

Let us assume that you and your husband bought your executive four bedroom detached home with the assistance of a capital and interest repayment mortgage that you are repaying at £1,000 per month over a 25 year period. Hopefully, you will have taken out some decreasing term life insurance that will pay out a sufficient sum to clear the mortgage should either of you die during the term of the policy. As a result, this will go some way towards easing the financial burden for your husband if you were to pass away as described in the previously mentioned scenario.

If you and your husband felt that just having life cover to pay off the mortgage in the event of either of you passing away was not going to be enough then you could also consider additional level term life assurance. The proceeds of such a life insurance policy could be used to help your husband meet childcare costs and any other shortfall in income to enable your husband and child to maintain the standard of living that you have become used to.as a family. If you had planned to put the child through private education then you could also include this in your calculations when deciding upon the level of life cover that you need.

Single Mum

However, what If you are a single, self-employed mum currently living in a rented property? If this is the case, then it could be argued that it is even more important that you consider any implications relating to the care of your child in the event of your untimely demise as your small family unit is no doubt totally reliant on your income assuming that the father of the child is no longer “on the scene” and doesn’t provide any financial support.

Therefore, should you pass away whilst your child is financially dependent upon you, what will happen to him or her? For instance, could the youngster be looked after by his or her grandparents? Of course, if they were both too infirm then this would not be a practical option. If they are in good health and willing to take on the responsibility would they require any financial assistance to do so? If the answer is “yes” then an option available to you is to take out life insurance such as term life cover to provide a lump sum in the event of your death with those monies being used by your parents to help bring up their grandchild. Essentially a great option for insurance cover as a single mum.

If an alternative form of care was necessary then the proceeds of the above policy could be used to help fund this.

Arranging Life Insurance

So, having established that you have a need for life cover, where can you obtain one or more competitive life insurance quotations and how quickly can you arrange cover? Well, you will be pleased to read that there are many providers of term life insurance. You can obtain quotations from one or more sources such as through your bank or building society, direct from the insurer, through an independent financial adviser, via the Internet by using the likes of a price comparison website or through the likes of Bequest. It is quick and simple to obtain such life assurance quotations and, once you have made your mind up which insurance company to apply for cover with the process is usually very quick so you should be able to get life insurance in place promptly with their often being no need to attend a medical.

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FF Bequest Limited, trading as Bequest, is authorised and regulated by the Financial Conduct Authority with firm reference number 923791. You can check our authorisation on the FCA Financial Services Register by visiting the following website: register.fca.org.uk . We are registered in England and Wales, Registered office address: Founders Factory, Northcliffe House, London, United Kingdom, W8 5EH. Company Number 12367897.

Regulated by the Information Commissioner's Office (ICO) [ZA662891]. “Bequest" is trademark protected by FF Bequest Limited (UK00003452648). FF Bequest Limited is registered in England and Wales, No 12367897.