Families & Life Insurance – Why It’s So Important Thumbnail

Families & Life Insurance – Why It’s So Important

Lewis Murray 15th May 2018

Life insurance is a challenging product to explain correctly. In today’s fast-paced world, we’re used to getting something quickly and seeing the benefits almost immediately. This makes it something of a struggle to fully explain the importance of life insurance. It’s a difficult concept to grasp: you pay a monthly premium for money that you won’t personally benefit from. However, that money may provide financial security and stability for your family at a time when they’ll need it most. Having a life insurance policy truly is a selfless act of compassion and kindness for the ones closest to you.

 

Financial worries at a time when they’re not needed

When the average family owes £123,870 on their mortgage, you’d be surprised to hear that only 50% of UK households have a life insurance policy in place. What happens if the breadwinner were to suddenly pass away? How would that family continue making mortgage payments, as well as paying for the bills and living costs? This is where a life insurance policy comes in, and that’s why we’ve made it our mission at Protect Line to help reduce the UK’s life insurance deficit and make sure that more families are protected so that, when the time comes, financial commitments are not the cause of stress and misery on top of an already emotionally-challenging situation.

 

Why do I need life insurance?

One of the most frequent questions we have from our customers is, “why do I need life insurance?”. It’s perfectly understandable. We pay £20 a month to protect our phones from damage, so if we drop our brand-new phone and the screen cracks, we’ve got peace of mind that our phone insurance will provide us with a replacement. But what about you? What if you break? Unfortunately you can never be replaced for your family, but that £20 a month could go towards having a plan in place so that they won’t need to worry about money.

 

How much debt would a family have to cover?

The average total debt per household in the UK is £58,240 as of May 2018, and the cost of an average funeral in the UK is £4,078. Factor in the mortgage repayments, bills, food and other essential outgoings like fuel for the family car and you’re looking at a substantial amount of money that needs to come from somewhere. Nearly a fifth of families with mortgages say that they wouldn’t have any ideas about how they would cover the bills if their partner was gone, and only 48% said that their savings could potentially cover them for a few months.

 

“Death is a part of life. Once we accept it and prepare for it, we’ll be much better off in the long run”

 

Unfortunately, there are families out there who don’t have any life insurance policies in place, and this has meant that some families have struggled to stay afloat during this time. Lewis Murray, our Digital Marketing Executive at Protect Line told us about his experiences: “I am someone who has struggled financially due to the death of a family member. My father was diagnosed with terminal cancer in 2014. It came out of nowhere and we were not prepared to deal with it.

I was living at home with my parents, my sister and my girlfriend, saving all the money we could muster to go towards a deposit for our own home. My father was self-employed, but the cancer meant that he could no longer work; my mother went through depression and acted as his primary carer, so it was down to me to step up and keep up with bills and paying for the essentials like food and fuel. Our savings quickly vanished.

 

“We’re all absorbed in our own lives that we believe nothing terrible can happen to us”

 

When my father passed away after a long battle with his cancer in August 2015, we just about managed to scrape the funeral costs together and I worked two jobs to make ends meet. My mother couldn’t work due to depression. I’ve never been more emotionally or financially unstable in my life. Having life insurance would have made everything so much better. My parents’ policy had ended once the mortgage had been repaid but they didn’t contemplate that cancer or an early death could affect them.

I think that’s the biggest issue with life insurance in general – we’re all absorbed in our own lives that we believe nothing terrible can happen to us; it’s something that happens to other people, so we put off the cover because we don’t see the results. Nobody wants to think of death. But death is a part of life. Once we accept it and prepare for it, we’ll be much better off in the long run.

 

Lewis and his Dad, John

Lewis and his Dad, John.

 

I can’t put into words how the lack of a life insurance policy has affected my family, but we are recovering. It made an already terrible situation so much worse and I wouldn’t wish that on anyone. That’s why working at Protect Line means so much to me; I’m in a fortunate position where I’m doing my part in protecting families in the UK and saving them from the awful experiences I’ve been through.”

 

 

Sources:
UN.org
Scottish Widows
Money Advice Service
The Money Charity