How much cover do you need?
That depends on who you want to protect, for what and for how long.
You may want to give your partner a cash sum after you're gone. Or look after your children until they're old enough to look after themselves. That could be 18, 21 or older – and can cost tens of thousands of pounds (CPAG, Cost of a Child Report, 2020). Updated version of this report is available at https://cpag.org.uk/policy-and-campaigns/report/cost-child-2020. There are three types of cover to choose from that support different needs.
Get the right cover for your family
Choose from three different Life Insurance policies to give your family the protection they need:
- Decreasing Cover – the cash sum reduces each month, in line with how the balance decreases of a loan or a capital and interest repayment mortgage with an interest rate of 8%.
- Level Cover – pays out a fixed sum if you die during the term of the policy
- Increasing Cover – what you pay and the cash sum increase each year to reduce the impact of inflation
Compare life insurance
Help protect your family’s needs with Critical Illness Cover option and Children’s Cover option
Would your family be financially secure if you suffered a critical illness? Criticial Illness Cover can be added (at additional cost) when applying for Post Office Life Insurance. It pays a cash sum if you suffer from cancer; excluding less advanced cases, heart attack; of specified severity, stroke; resulting in permanent symptoms or coronary by-pass grafts; with a surgery to divide the breastbone. At such a difficult time, it can ease financial pressure on you, your family or your partner - like helping for a mortgage, rent, everyday living costs, even modifications needed to your home as a result of your illness.
Children’s Cover is also an optional extra to cover your little ones, by choosing to add children's cover to your Post Office Life Insurance policy, for a little extra each month, you'll get 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, to help support you and your family at a difficult time. It's designed to (that meets our definitions) help cover extra costs that may be incurred for things like medical expenses, taking time off to attend hospital appointments and arranging childcare or making adaptations to your home.
Don’t forget inflation
When you take out life insurance, consider taking an increasing or index-linked policy, to help offset the effects of inflation on the value of the payout. For example, £100,000 today won't be worth £100,000 in 20 years’ time. The Bank of England has a handy tool that shows the impact of inflation over time.
