Why should I get life insurance? – Aviva

We often see the difference that having life insurance can make for bereaved families.

So, when our survey of 500 people 1 whose partner died in the past five years showed that for the majority of families (65%), the partner did not have life insurance, we wanted to highlight how having coverage could make a difference. big difference, when it really matters 2.

Reading: Why should i get life insurance

1. so that they feel economically comfortable

The loss of a partner will inevitably affect the family’s finances and affect your financial comfort level, whether or not you are the primary breadwinner. But in our survey, there was a noticeable scatter in trust levels between those whose partner had life insurance and those who didn’t.

where 69% of families whose partner did not have life insurance felt “fairly” or “very” financially comfortable while the partner was alive, this dropped to 33% after their death. for those whose partner had life insurance, it fell from 81% to 58%, so most still felt financially comfortable.

Perhaps it’s because life insurance pays a tax-free lump sum if the policyholder dies within the term of the policy. therefore, financial support in the form of a cash payment could help your loved ones feel financially secure when you are gone. our coverage also pays if you are diagnosed with a terminal illness that meets our definition and you are not expected to live more than 12 months.

2. so they don’t have to move house

If you want to help make sure your family can stay in your home if you die within the policy term, without the turmoil of moving, life insurance could help you create that protection. paying a valid claim could help them pay their mortgage or keep up with their rent payments, and not have to move to a more affordable place to live and change their address at a difficult time.

In the survey, a third of people whose partner died in the last five years no longer lived in the same house, and 45% said they had to move to a smaller or cheaper property because they couldn’t pay rent or mortgage.

Of those whose partner did not have life insurance, more than half (52%) said they moved for financial reasons.

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But when the deceased partner had a life insurance policy, they were less likely to move out of the family home, with emotional reasons and a fresh start being the main reason for moving (68%), not stretched finances.

3. so they are prepared for unexpected costs

In the same survey, married and cohabiting couples who did not have life insurance were more vulnerable to financial crises if their partner died, compared to those with life coverage. So if an unexpected cost came up, like a car that needed repair or a washing machine that broke, they would have a hard time paying for it, or they might need a loan.

When asked if they could afford an unexpected £500 expense, a quarter of those surveyed said they couldn’t. while only 19% of families where the partner did not have life insurance said they could afford it without some hardship, 35% of those where the partner did have life insurance said they could afford it without adverse effects.

so life insurance can help with more than just regular costs and staying in the family home. can help put a family in a better financial position and make them better able to deal with the kind of unexpected expenses that have a habit of cropping up when you least expect (or need) them.

4. so they don’t have to trim

In addition to potentially moving out of the house, if finances are affected by the loss of a partner, it may mean the surviving partner has to cut back wherever there is an opportunity.

Our research shows that if a couple did not have life insurance, the surviving partner was more likely to take steps to make up for lost income.

Overall, cost-cutting measures included cutting non-essential monthly expenses like vacations and entertainment and other luxuries (43%), spending less on groceries (36%), and even selling personal effects (25%). ). it also led some to give up their car, take out loans or, in 21%, use credit cards.

While it may not prevent the need to cut back, a life insurance payout can go a long way toward maintaining the lifestyle the family had when the couple was alive, without having to make any sacrifices. difficult.

5. so your partner’s work-life balance is a choice

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For some, losing a partner may mean having to reevaluate the hours worked or change the type of job they have.

In the survey, the majority of people who had a job received paid bereavement leave (79%), and most felt the time off was enough. but more than two in five (43%) still felt they could have done with more free time immediately after their partner’s death, and this rose to three in five (60%) for bereaved couples in the area london metropolitan.

And after that, though? almost two in five people (36%) said that the death of their partner had an effect on their employment status. that could mean making up for lost income by taking on more work than they would ideally do (20% is true) or changing jobs. But for some, that might mean struggling to keep a job and your regular work hours, and having to take on less while grieving, or perhaps making it easier to care for young children.

while in a minority, nearly a fifth (17%) of people had to quit their jobs, with 15% needing to work fewer hours and 11% changing jobs to be able to work more flexibly .

Whatever the reason, it’s easy to see how being more financially stable could mean that this kind of immediate job change at an already difficult time could be avoided.

6. so that everyone feels calm

Having life insurance gives you peace of mind knowing that if you die within the term of the policy, your loved ones will have a lump sum on a valid claim to help them manage financially, with the mortgage, bills, childcare or simply help maintain their standard of living. can help everyone plan for the unexpected.

The survey showed that more than four in five people (81%) surveyed were worried about their current financial situation after losing a partner. Life insurance can go a long way to help ensure that your loved ones don’t run into financial problems, or have additional problems from moving, changing jobs, or cutting costs when you’re gone.

And it can also be reassuring to know that in 2021, we pay out over £731 million in claims, which is 99.4% of the claims we receive3.

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