What Level of Cover do I Need?

What level of cover do you need ?

This will depend on cost, and your circumstances and objectives. The first stage of this exercise is to establish what is already in place. The following questions should provide some guidance as to the issues which you need to consider:

-What financial liabilities are not covered by life assurance, such as a mortgage, bank loans, overdrafts etc?
- If you are employed, does your employer provide death in service benefits? Are you a member of the scheme? What is the sum assured?
- What is the value of any existing life assurance policies, savings and investments?
- What State benefits would your dependants be entitled to?
- If you have a Personal Pension, what is the death benefit of the plan and to whom is it payable?
- Have you made a will to ensure that your estate passes in accordance with your wishes? -After paying off any liabilities, what level of income would you dependants need to sustain their standard of living?
- Do you plan to send your children to public school? What level of fees would your dependants need to cover and when would they become payable? This may also be relevant if your children need funding for higher education.
- How many years are left before your children cease to be financially dependant?
- How many years are left before you retire and receive your pension income?
- If you are a member of an occupational pension scheme, what benefits does the scheme provide for your dependants in the event of death before retirement and in retirement?

The questions raised above are not intended to be exhaustive. The issues which need addressing will depend on your particular circumstances. They can, however, be a useful guide to arriving at the level of income and capital which could be available to a dependant(s), and identify where additional income/capital might be needed.

The next stage is to decide what capital/income is required to ensure that dependants are covered in line with your objectives. One needs to decide on what basis the figures should be calculated and what type(s) of plan would be the most suitable.

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