WHAT YOU NEED TO KNOW
LifeShield aims to make life insurance as simple and easy as possible. We know you’re busy; that’s why we don’t ask you to fill in long forms or answer complicated questions. But we also want to make sure our cover is right for you.
Take just a minute to read through some frequently asked questions in our life insurance checklist to answer all your questions.
WHAT IS LIFE COVER?
Life insurance generally pays out a lump sum if you die during the period of the agreement. Your husband, wife, children or any other person you choose can use the money however they want after you’re gone.
DO YOU NEED IT?
If you work and have people depending on you, it’s important to consider how they would cope without your income.
Every year in the UK more than 75,000 working age adults die before they reach 651. As many as 5% of children – 41,000 a year – lose a parent before they finish school2.
What would change if you weren’t there to provide for your loved ones?
- Does your husband, wife or partner work, and is their income enough to provide for them and any children?
- Could they comfortably pay for funeral expenses that average £3,6003?
- Even if you have insurance to cover a mortgage, would your family need money for other expenses?
- How long would any savings cover the bills for rent, utilities, groceries, and transport costs?
- Do you have debts such as money on credit cards or outstanding loans or hire purchase agreements?
- Would your family be able to afford luxuries such as days out, birthdays or holidays without your income?
WHAT IF YOU ALREADY HAVE INSURANCE?
You can buy life insurance even if you already have an existing policy, such as one covering a mortgage. Both policies will work in exactly the same way, so you won’t lose out.
WHAT ARE THE DIFFERENT TYPES OF LIFE INSURANCE?
Life insurance comes in a variety of forms. The most common type is “term insurance”, which covers you for a particular period – for 20 years or until you are 65, for example. Most people opt for term insurance rather than whole-of-life cover (which covers you until you die, at whatever age) because it is much cheaper and doesn’t require you to keep paying premiums into old age.
If you decide to take term insurance, you still have to decide whether you want a “level term” insurance, which pays the same amount throughout the period of cover, or “decreasing term” insurance.
Decreasing term insurance is often used to cover mortgage expenses, because the amount it pays out decreases over the years in line with the amount of the mortgage that is paid off.
In order to choose the right option, just consider what the insurance would pay for:
- How long do you need the cover for?
- Will you still have children or others needing the same level of support even after you’re retired, or is affordable cover now more important?
- Will the insurance be used to cover a mortgage that decreases as time goes on, or will it pay for bills and other expenses that stay the same, fluctuate or increase?
Level Term insurance is the type of life insurance we offer at LifeShield.
WHAT IS MORATORIUM UNDERWRITING AND WHAT ARE THE BENEFITS?
Moratorium underwriting is widely used by insurers. Everyone can be offered cover, but the insurance won’t pay out if you die as a result of any conditions or illnesses you’ve received treatment for or have seen a doctor about in the three years before you apply for the policy.
This keeps things simple, letting insurers offer cover without having to collect lots of personal information. You just need to ask yourself:
- Have you been turned down for life insurance in the past?
- Are you put off by the thought of answering questions about your medical history and finances?
- Can you spare five minutes online or on the phone to get up to £100,000 of cover for an affordable monthly premium?
If you’ve answered yes to any/all of these questions, a company like LifeShield may be able to help.
WHAT DETERMINES THE PRICE?
The price of the insurance depends on how much cover you want (£50,000 or £100,000), how old you are, and whether you smoke.
It’s that simple.
HOW DO YOU KNOW IF YOU CAN TRUST AN INSURANCE PROVIDER?
You need to be confident your life insurance provider will honour the policy and pay out to those you leave behind when you’re no longer there. As such, questions to ask include:
- Is it a company you can trust?
- Do they have a track record?
LifeShield as a company has been running since 1998. Its LifeShield insurance business acts as an appointed representative of Compass Underwriting Ltd, one of the UK’s leading independent accident and health underwriting agencies, which is regulated by the FCA and has more than two decades’ experience in the insurance market.
 Office of National Statistics Mortality Statistics: Deaths registered in England and Wales (Series DR) http://www.ons.gov.uk/ons/rel/vsob1/mortality-statistics–deaths-registered-in-england-and-wales–series-dr-/index.html
 Childhood Bereavement Network, Key Statistics http://childhoodbereavementnetwork.org.uk/research/key-statistics.aspx
 The Money Advice Service, How much does a funeral cost? https://www.moneyadviceservice.org.uk/en/articles/how-much-does-a-funeral-cost