Life insurance for family

Every family is different, but they often play a big part in our lives. It’s important to think about how we can protect them against the unexpected as best we can.

life insurance options

Big ears, baldness, brown eyes – these are all things that can be inherited. But what about life insurance to protect your family?

Life insurance for a family's future might be thought of as the responsibility of one person, but there are going to be times throughout life when different kinds of life insurance are better for different people.

A newly-wed couple thinking about their first child are likely to have different concerns to the person whose children are having children of their own, so taking stock of your stage of life to see what type of life insurance is right for your family can help make sure those you love have the best protection.

Meeting that special someone

Whether you're 27 or 77, it’s never too late to meet The One. If you are considering the possibility that you want to spend the rest of your life with someone and want to ensure that the future is going to be safe for each other should one of you die, then you might want to consider whether you would like a joint policy or two single policies.

A joint policy can pay out if one of its two policy holders dies, leaving the remaining partner with a cash payout to help ease the financial burden. Remember though that the policy will end once it has paid out.

If you are considering children (or already have them) then two single policies may be more appropriate, as this pays out twice – once upon the death of each parent.

At Post Office, we don't offer joint life insurance policies, but you could get two single policies to make sure your kids have a financial lifeline should either you or your partner die, or if you were to separate.

Getting a mortgage

If you are thinking about getting a mortgage, then you may also want to consider what could happen if you were to die before the repayments were complete. Whose financial responsibility would this be? Whether it’s your parents, your partner or your children, it is unlikely that you would want them to have to worry about it. A life insurance plan for a family can help mitigate for this.

Decreasing term cover

Decreasing term life insurance

A decreasing term policy helps to cover the cost of your mortgage or any other decreasing debt or loan if you die before it is completely paid off. It is a term policy, meaning that it has a pre-determined length of time (in this case, the projected amount of time before your mortgage is paid off). As your repayments reduce the overall size of your outstanding mortgage, the payout you would receive decreases.

Insurers will place a cap on the mortgage interest rate that they offer cover for. This means that if your mortgage interest rate is higher than the cap placed by your insurance provider, your payout might not completely cover your outstanding debt.

Having a child

Having children is a powerful incentive to protect those we care about most and think about getting life insurance for your family. Since children are so dependent on their parents, it’s a natural feeling to want to help them get the best out of life even if you’re no longer around to be there with them.

There are term life policies that can leave your beneficiaries a large lump sum, which can help to pay for the general expenses of life. 

However, in the shorter term, the Post Office also offers Free Parent Life Cover. These are term life policies that last one year and cover you for £15,000 for each child you have up to the age of four. Both parents can apply independently and you can get protection for up-to 8 children for a year.

For those who are new to life insurance, this is an introduction that will give you a good idea of what life insurance covers and the kind of peace of mind that a life insurance policy to protect your family can bring.

As your children grow

Life can be an expensive business. The costs associated with living a fairly average life have increased greatly from a decade ago, in part due to inflation and in part due to a wider range of necessary expenses. TV, mobile, broadband and online subscription expenses are much more common, and house prices and the cost of living is generally higher.

If you were unable to support your family, would they have the necessary means to continue life as they know it? Once all of the expenses have been factored in, it can become clear that a life insurance plan is a sound idea.

Level and increasing term policies are types of term cover that offer cash payouts in the event that the policy holder dies within their terms. The uses of a payout differ family-to-family, however the overarching idea is to prevent any further upheaval to the lives of those left behind. This may be to continue to pay school fees or musical instrument lessons; it may be to continue to pay rent on a property or it might be simply to leave a gift to your beneficiaries so that they can invest it or even go on holiday. In any event, it is your way of ensuring that the future of your loved ones is that much easier.

Level term

level term life insurance

Level term policies offer a cash payout that maintains the same financial value throughout the term. Therefore, if the payout is £100,000 at the beginning of its policy, it will be £100,000 at the end too. Due to the effect of inflation, it may be that this has less value in real terms, depending on the length of the policy.

Increasing term

Increasing term life insurance

Increasing term cover adapts for the effect of inflation, increasing over time to give your payout the same real-terms value as when the policy was taken out. Due to the gradual increase in your payout, your premiums will annually increase as well.

 

As you get older

As we become older, our risk of serious illness increases. If you are thinking of taking out a life insurance policy to protect your family and want to cover against critical illness, you might consider taking out a Critical Illness Benefit alongside your cover.

The nature of this cover varies from insurer to insurer, however at the Post Office, this means that if you develop a critical illness that meets our definition, your policy can pay out up-to 25% of the value of your payout to help pay for expenses and loss of earnings during a difficult time.

When your kids have kids

Approaching the latter half of your life can make you consider what insurance your family might need to help pay for things like your funeral, or your outstanding debts if you were no longer around to pay them.

Over 50s cover might be an important part of a family life insurance plan. It differs from term life policies in that it is cover that lasts for the rest of your life, regardless of how long that is. The payouts for Over 50s policies tend to be significantly lower than for term life policies, and are not designed to cover large repayments such as mortgages.

Rather, they can help contribute towards the cost of your funeral, settle credit card bills or act as a gift to your family. There are fewer qualifying factors to over 50s policies – with the Post Office, you simply need to be a UK resident aged 50 to 80 to qualify.

If life insurance for your family is something you’re thinking about, use our calculator to find out what you might need or consult our team to discuss what type of policy might be right for you.

If you’re convinced that you need life insurance, then consider a life cover policy from the Post Office.

Other ways to get covered

Post Office Life Insurance

Choose between level, decreasing or increasing term insurance, each designed to offer you peace of mind based on your circumstances.

Life Insurance

Post Office Over 50s Life Insurance

If you're aged between 50 and 80 Post Office could help you to leave your family the gift of a cash sum or help towards your funeral costs

Over 50s Life Insurance

Post Office Free Parent Life Cover

If you have children aged under four years old, you could get £15,000 of life cover free for a year. That's £15,000 each for mum and dad.

Free Parent Life Cover

Post Office Critical Illness Benefit

Get extra protection and financial peace of mind by adding the optional Critical Illness Benefit to your Post Office Life Insurance.

Critical Illness Benefit

A closer look at family life insurance

For more information on the above policies, you might want to look at our list  Post Office life insurance guides and articles. They cover a range of topics and go into greater detail on all of the policies and situations outlined above.

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