Life insurance for mums

What sort of life insurance is there for mums?

The first concern for a mother who wants to take out life insurance is whether or not you are paying a mortgage, as this will have a significant bearing on what type of future situation you are aiming to help your children with.

Decreasing term life insurance

If you're paying a mortgage, then decreasing term cover could be the most helpful. This type of policy often has the lowest premiums of the three most common term life options (for the same amount of cover) and is designed specifically to cover gradual repayment debts. The rate at which the payout amount on a decreasing term insurance goes down is designed to be broadly the same as how the outstanding balance of a capital and interest repayment mortgage decreases.

Therefore, should you die during the term of this policy, your mortgage obligations should not fall to your partner or children. Most providers have a cap on mortgage interest rates, meaning that mortgages with interest rates over that cap may not be fully covered by a payout.

Level and increasing term life insurance

For the raft of other costs that come with life, there is level term cover and increasing term cover. These have cash payouts, which can be put to whatever use the beneficiaries choose.

You might have a child who attends a fee-paying school, for example, and you wouldn't want them to have to alter their situation should you no longer be able to contribute. Therefore a cash payout can help to maintain stability in life if you were to pass on.

If you’re a parent, childcare may be an important concern. If mum were to die, could the remaining carer adjust their work patterns to attend to the kids? If not, they’ll need to pay for childcare, which life insurance may help cover. And, even if they can take time off or leave work, they may need financial security to cover lost earnings. Life cover can help provide it.

Critical illness cover and children’s cover

Could you keep paying the bills if you were diagnosed with a critical illness, like cancer or a heart attack? Adding optional critical illness cover to your life insurance, and spending a little extra for it, could help ease the financial burden on you and your loved ones at a difficult time, when you may not be able to work to provide for them.

Serious conditions can affect anyone. Policies with children's cover may help protect your little ones too. For an additional premium, this optional add-on to life insurance policies provides a one-off lump sum payment if any of your insured children suffer an accidental death or are diagnosed with a serious injury or illness. This can help support you and your family at a difficult time.