10 things to know about life insurance
Here are 10 of the most useful things to know when you’re considering life insurance to protect your family.
The 5 minute lowdown on life insurance
Let’s face it, life insurance probably isn’t the most interesting of subjects to have to read up on. But it is an important one, especially if there are people out there who depend on you financially. In short, having a policy in place could make all the difference to your family’s livelihood if you passed away and they had to get by without you.

That’s why it’s worth taking the time to learn about how life insurance works and the options available, so you can decide how best to protect your family. In this article, we run through 10 useful things to know about life insurance to help you understand the subject better.
1. If someone relies on you, think about life insurance
If you have a partner, children or any other person who relies on you, you should give life insurance serious thought. Think about it. If you died, how would they cope without the money you bring in? Could they keep the roof over their heads and maintain the lifestyle they have now? Life insurance could provide a lump sum pay-out or regular income to give them some financial security.
2. Think about life cover even if you don’t bring home the bacon
Never underestimate the value of a stay-at-home parent to the family. If you work out the cost of everything you do for the kids and the home on a daily basis, it will probably equate to a healthy annual salary. Use our mum salary calculator to see for yourself.
3. Get started sooner rather than later
Whether you own your own home or are a new parent, it’s never too soon to take out life insurance. But there is the unfortunate possibility of leaving it too late and leaving loved ones with any financial burdens that come with losing you.
4. There’s more to life insurance than the money
First and foremost, life insurance pays out cash in the event of your death, helping provide for your family.
But importantly, it could also give you and your loved ones peace of mind. Simply knowing that if the worst were to befall you, the household budget would not be put under too much pressure, creating space to help them come to terms with your loss is reassuring for all concerned.

5. There are two main types of life insurance
Term life insurance
This is a policy that pays out only if you die during the duration of the policy – typically between 5 and 30 years. With a level term policy, the premiums and cover amount are guaranteed never to change. With a decreasing term policy, your cover amount goes down year on year. This is because the sum of money that will be paid out should you die is also decreasing over time. This is similar to the way a repayment mortgage decreases and so it makes it a popular way to cover a mortgage. In the event of your death, your loved ones may be able to pay off your outstanding mortgage. Typically, decreasing term life assurance to accompany a repayment mortgage is cheaper than a level term policy but you can get quotes for both and decide which best suits your needs.
Whole of life insurance
Whole of life cover guarantees to pay out on death, whenever that happens to be. It literally covers you for the whole of your remaining lifetime. Whole of life insurance is more expensive than a term policy.
6. Weigh up joint life versus single cover
Many life insurance policies can be purchased as a single life or on a joint basis. If you and partner want a chunk of cover each, it may make sense to consider separate policies. Some joint policies only pay out once on the first death and then the policy ends, leaving the surviving partner without cover. If in doubt, compare the small print and get a life insurance quote for joint and single life cover, there are so many options available you will be able to find the right solution for you.
7. Understand what you’re committing to
You commit to two fundamental things when you apply for life insurance. To be honest with the insurer on your application and to pay what’s required when required.
So, always be totally upfront about your health and lifestyle when asked. Withholding information or being economical with the truth could result in your insurer refusing a claim, potentially leaving your beneficiaries without the settlement that they may have been expecting to rely on. And always pay your premiums when asked to, which is usually every month throughout the policy term. If you stop paying for any reason, you risk your insurer cancelling your policy.
8. Work out how much cover you need and for how long
No one knows you better than you. The contribution you make financial or otherwise, what you want to protect, the needs of your dependants and, what you can afford to pay each month are all unique to you.
Deciding how much life insurance you need, and the number of years you need it for, isn’t as complicated as it might sound. Use our simple life insurance calculator, to help you estimate the right amount of cover for your personal circumstances.
9. You can add critical illness cover to your policy
Some insurers offer the addition of critical illness protection to your life insurance when you apply, and pay for both together. Critical illness cover usually pays out a percentage of your life cover if you're diagnosed with a serious medical condition, such as a heart attack, stroke or certain cancers during your policy term, to help you and your family get by. When taking out life insurance, bear in mind that only certain diagnoses trigger a cover payment and this will vary depending on your provider.
10. Things change so review your cover regularly
As you go through life, things will inevitably change and that could affect the amount of cover you need. For example, a change in job, a marriage, children, a bigger mortgage or divorce. Make sure you review your life insurance and are confident you have enough cover for your current situation. If not, you might be able to take out an additional policy to top up your cover.
SunLife offers a range of straightforward and affordable products including over 50s life insurance, funeral plans, equity release, home insurance.