Do I need life insurance if I’m single?
Life insurance is commonly regarded as a financial safety net that will look after our children and dependants if we pass away, so it’s easy for anyone not in a relationship or who doesn’t have children to think it needn’t apply to them. But, in fact, it can be a lifeline for people in all kinds of situations, regardless of relationship status. Here’s why you might need life insurance if you’re single:
What is life insurance?
Life cover pays out a lump sum of money should you pass away, enabling your loved ones to remain in the family home and pay the bills. Policies run for a set term, such as until you retire or until dependent children leave home. The premium you pay and the sum assured (the level of cover you get) depends on things such as your age, your health and your lifestyle.
Why do I need life insurance?
Life insurance can be used in a number of ways after you’ve gone. If, for example, family members such as your parents or siblings aren’t very wealthy, a life cover payout could meet the costs of your funeral, taking away from them this unexpected expense at a stressful time.
It can also cover any credit card bills or debt you might have. Debt can’t be ‘inherited’ by anyone named in your will, but it can be deducted from your estate - the assets that you leave. Knowing that any outstanding debt will be covered by your life insurance can give you peace of mind that the legacies you wish to leave will be passed on.
If you co-own a business, life insurance is one way in which your business partner would be able to continue operating in the event of your death. Do note, however, that going into business with anyone requires very detailed discussions around what might happen should one of you pass away or wish to sell up, and it’s best to seek legal advice - even if your business partner is a family member!
You may not have children or be in a relationship, but do you have a disabled sibling or elderly parents who depend upon you? You may be planning to care for them for the rest of their life; of course you don’t want to contemplate not being there for them but, should the worst happen, you will want to know they’ll be left in the best possible hands.
Sadly, many families find it very difficult to talk about death until it’s too late. Recent research from Solicitors for the Elderly revealed that 79% of Brits haven’t spoken about their medical or care wishes in later life with their loved ones, and that, as a nation, we could be facing an incapacity crisis if we fail to plan for the future. Putting the right life cover in place is a good chance to chat to your dependants about what might happen if you’re no longer there, whilst our article on talking to your family about death also has some good advice on raising this difficult subject.
Lastly, the best time to buy life insurance is when you’re young and healthy! Taking out cover in your late teens or 20s can be much cheaper than in your 30s onwards. The earlier you buy, the lower the cost tends to be, because you’re less likely to have one of the health conditions that can become more common once you pass the big 3-0.
If you leave life insurance until later, conditions such as high blood pressure and cholesterol, and even being overweight, could result in higher premiums. Whilst you’re younger, however, insurance can start from as little as £5 a month, and this price will be fixed for the duration of the term.
Our life insurance policies can be taken out by adults between the ages of 18 and 80, and our life insurance myth-busting guide is well worth a read! You might want to look into other types of protection insurance and compare critical illness cover and income protection. Both can prove invaluable when life doesn’t go quite to plan, and our article explaining the difference between critical illness insurance and income protection can also help you decide which one you need.