Sorting Life insurance after leaving your partner
“Fame,” went the song. “I’m going to live forever.” If only that was true – so far, not even Leroy Johnson has discovered the secret of immortality. Life insurance can feel a strange thing to talk about at the best of times, but throw in a split with your partner and the subject becomes even more awks. Fear not, I can guide you through this dilemma.
Let’s kick off with some basics – life insurance provides a payout if you die. If there are people who depend on you not being dead, then life insurance is definitely something you should think about.
If you’re considering a mortgage, or already have one, you really should have life insurance. Big expenses like these can be a heavy burden on anyone who’s left to cover payments if you happen to shuffle off to another plane of existence.
So what happens if you unexpectedly split with your partner? Here’s the lowdown:
Review everything you have
It’ll be a tricky time in your life, but make sure you review exactly what insurance you currently have. If you have a joint mortgage, it’s likely that you might also have joint life insurance. Unfortunately you can’t just divide a life insurance policy down the middle like a whale noise CD collection; so one partner will have to take it over, leaving the other with no cover.
Consider your options
What you do next really depends on your situation. Whether or not you receive/give child maintenance is something that needs to be considered. It’s also worth reviewing your will – if you’ve divorced from your partner, they will automatically no longer receive anything that you’d planned to leave them.
Do I need a new life insurance policy?
If you have children or other people who are still relying on you financially, you should think about taking out new life insurance. If you are taking out a new mortgage, either by yourself or with a fresh squeeze, taking out life insurance cover is definitely a wise move. I can totally help you with this bit in my Life Insurance section.
What kind of cover do I need?
Again, it really depends on your personal circumstances. Things to consider are your outstanding debt, how many people financially depend on you and what you’re looking to cover.
There are several different types of life insurance you can look at. A level term insurance will last for a set period of time and pay out a set amount if you were to die during that time. However, a whole-of-life insurance policy provides cover for the rest of your life. This is usually more expensive, but you can relax in the knowledge that your dependants will get a payout whenever you die.
The best thing to do is get out your calculator and work out how much money you need the policy to pay to protect your loved ones.
How much will it cost me?
How long is a cosmic tendril? You can find life insurance for as little as £5 a month, however the amount is dependent on things like age, health and how much you want to cover.
Looking for life insurance can feel a bit strange and is a complicated process, so let me help. Keep an eye on my Wisdom section, which contains all the tips, ideas and financial guidance you’ll need in this life and the next.
Peace and loans,
Published on 21st February 2017