One in Two Adults Have No Life Cover

One in Two Adults Have No Life Cover

by David Redmond on 28 Feb, 2011

Despite roughly two-thirds of the adult population having dependents, more than half of all adults in the UK have no life insurance at all. According to new research, one of the main reasons given for not taking out insurance is that some people actually do not have any dependents. This is possibly the only legitimate reason for not taking out life insurance.

Put simply, life insurance is protection against the loss of income a family might suffer from the death of a loved one. With this in mind it would be a waste of money for someone without dependents to not take out a life insurance policy. For anyone with dependents (two-thirds of the country) life insurance is the best way to ensure your family’s financial situation is alright should you die unexpectedly.

Another reason given for not taking out a life insurance policy is that people often don’t think about life insurance. Many people either don’t understand exactly what it covers or don’t believe it could apply to them. If a loved one dies, the last thing your family will want to be thinking about is money. A death can be financially draining as well as emotionally and a life insurance policy is the best way to avoid this type of situation.

A small percentage of people also believe that life insurance isn’t value for money. Insurance of all types is often seen in this way, as the benefits of insurance are only felt when the unthinkable happens. For example, paying for car insurance is often labelled as just another cost to owning a car but if you are unfortunate enough to be involved in a car accident, you will be thankful that the insurance was in place. Life insurance differs in that you will never personally feel the benefit of it, but your loved ones will.

It is important to understand what types of life insurance is available. The two main types are known as ‘Term Life Insurance’ and Whole Life Insurance’.

Term Life Insurance only covers a specified term, or period of time. This is usually in either five, ten or fifteen year periods. This type of insurance is often the cheaper option when it comes to life insurance. Whole Life Insurance usually costs more than Term Life Insurance as it covers you for the rest of your life and your premiums, over time, gain a cash value.

The amount of people without life insurance is low, one in two people. Not having life insurance has the potential to cause financial problems for many families in the UK. If you have one or more dependents but do not have life insurance, it is advised that you look into taking out a life insurance policy soon.

About the Author

David Redmond

David Redmond is a Partner of Don Gilliard Finance Group. He is a fee-only, independent financial advisor and financial planner. For over 15 years, he has been helping individual investors and their families realize their investment goals.