‘’I’m renting, do I really need life insurance?’’
If you rent your home then you might think that life insurance isn’t for you, but as with many things it depends on your situation.
Since 2007, the number of private-rented households has grown by 60 per cent as house prices have soared. This has left so many renters unprotected since protection is traditionally sold at the point of a house purchase. Mortgage protection is a type of Life Insurance that covers your mortgage, so if you die before you’ve paid your mortgage off, your bank or mortgage provider receives a payment to clear it. As a renter you may not need a large sum paid off, but for most renters their biggest outgoing is the rent payments and bills associated to the home.
If this is the situation, then what happens if you get sick or need to take time off work due to sickness or to care for a loved one? What if this ended up being for a long time, 6 months, 12 months? Would you be able to make your rent?
If it’s a no, then think about Critical Illness Cover (CIC) or Income Protection (IP). IP is generally more expensive but will provide you with a monthly amount to help cover your bills, whereas CIC will provide you with a lump sum to use in whichever way you chose – medical bills, utility bills, a carer for your loved one. They both cover illnesses, but in different ways.
’’I’m renting, do I really need life insurance?’’. It doesn’t matter if you own your home or live in rented accommodation, some form of life insurance or critical illness or income protection will suit you.
The best way to find out what is right for you is to talk to an advisor. No one talks to a protection advisor when signing up to a rental, but you still have a commitment to pay the rent.
An adviser will get to know you and your finances and will research the whole insurance market to find the best kind of policy to suit your needs and budget. At Lizzie’s Life we want to help. We don’t charge if you would like to speak to someone – please feel free to contact us for more information or find out what could be right for you.