Why should I get increasing term cover?
If you are thinking of taking out a long term policy with a large payout you are most likely to be affected by inflation. If this is the type of policy you want, you might want to consider increasing term life cover.
It might be important to protect the size of your payout - whether that's debt repayment or a substantial purchase. Increasing cover can help to protect a payout from the long-term effects of inflation, which can provide peace of mind for this situation.
It’s important to assess your needs when considering any life insurance policy. Much of the decision will depend on what you intend your life insurance payout to cover. Typically, increasing term life policies are used to leave lump sum for loved ones that adjusts and protects against the rising cost of living by increasing by a fixed rate each year. This could to help pay off an interest-only mortgage, give the kids a chance to get their foot on the property ladder, pay towards educational costs or simply to contribute towards living expenses when you're no longer around.
If you have a sizeable estate and know that you are liable to pay a large amount of inheritance tax, you might consider increasing term life cover to help offset this bill.
There are also costs associated with your death that you might not have considered, for instance your funeral, or professional executors of your will if you do not wish to appoint your own. This sort of situation may require a more flexible payout which is the case with increasing term insurance.
Whatever your reasons for leaving a legacy behind, making provisions early can help to give peace of to you and the ones you love.