Shocking statistic!

A campaign has been launched to reduce the number of children who are left financially unprotected in the event of their parent’s death. 

The online movement, dubbed ‘Every 36 Minutes’ after a shocking statistic has revealed that every 36 minutes a child in the UK loses a parent without any life cover.

The Every 36 Minutes statistic stems from research by Aviva and Winston’s Wish, a charity that helps bereaved children.

The problem

Whilst the emotional impact of losing a parent is obvious, the financial implications for the children of the deceased are often overlooked.

• It now costs £218,000 on average to raise each child to the age of 21 (LV, 2010)
• A typical amount left outstanding on a mortgage, a huge £112,000 (Credit Action, 2012)
• 24,000 children lose a parent every year (Winston’s Wish, 2009) and at current 55% of adults are still uninsured (BGL Group, 2012)

With no life cover, parents risk leaving their children to fend for themselves financially in what is possibly one of the most difficult times in their lives. They will often have to give up extracurricular activities like music lessons or football coaching, maybe even move to a smaller house if the remaining parent cannot afford the mortgage payment or rent. This can take them away from friends and family at a time when they may already feel isolated.

Whilst no amount of compensation can replace a loved one, it can help remove some of the strain on the family income.

Why are so many parents unprotected? – Excusitis!

Excuse 1 - “It won’t happen to me!”

Parents are put off buying life insurance because they think it will never happen to them, so they won’t need it. But one in seven people will die before the age of 65 and 49 people every day in the UK die from unexpected accidents”.

This shows that death is not something that only affects ‘other people’, in fact it could hit your family at any time and the best thing to do is make sure you are prepared for it.

The problem isn’t just about making sure working-parents are insured either. Many stay-at-home parents are often left uninsured because they don’t directly contribute to the family finances. But hiring someone to replace the work that they do, for instance childcare, housekeeping, shopping can cost more than £70,000 (Salary.com).

Excuse 2 - “It’s complicated!”

People can be confused by the different types of life cover available to them but the various policies will help to make sure you are only paying for the cover that you need.

Choosing life insurance is also made easier by taking advice from an independent protection specialist, which will allow you to compare policies from a multitude of companies, thus ensuring that you get the most appropriate policy for your circumstances.

Excuse 3 - “It’ll never pay out!”

A common misconception about life insurance is that it simply doesn’t pay out. In fact, based on the mean average of all insurer’s payouts over 97% of claims are successful, with the majority of the remainder caused by dishonesty or misinformation at the time of purchasing.

This means that if you are less than truthful on your application, such as saying you’re not a smoker, when you are or that you have no family history of cancer, when you do; the insurer won’t pay out even if you didn’t die from that.

Excuse 4 - “I can’t afford it!”

The cost of life insurance is based on a number of factors, but largely influenced by your health and your age. There are a number of things you can do to cut the cost, such as giving up smoking and taking care of yourself more. At the end of the day, it is better to pay what you can afford and be a little underinsured than not insured at all.

Excuse 5 - “I haven’t got time!”

Just take 20 minutes to fill out a basic health questionnaire, send it back to us and we will do the rest. Using an independent broker takes away all the hassle of shopping around and trying to understand all the jargon, so that you know you are comparing like with like, and getting value for money.

Your guide to getting covered

1. Understand your circumstances.

The amount of life cover will be based on:

• How many dependents you have and the cost of looking after them if you weren’t there.
• The amount left to repay on your mortgage
• Other outstanding debts that would need to be paid off in the event of your death

2. How much can you afford?

There’s no point taking out insurance that you cannot afford, but better to have an amount of cover that you can afford than no cover at all.

3. Get the right advice!

For more information, call us for a chat or send us an email by visiting the “Contact Us” page on our website.