Life Assurance
No one likes to think about dying. But, if you were run over by a bus tomorrow would your absence cause financial difficulties?
If you have a family, a mortgage, money owing on your credit cards or other loans; or elderly parents who rely on you - the answer is probably "Yes".
In that case, life assurance could help by making sure there's money to take care of the people and situations you leave behind. (It could help to support you, if your partner dies.)
What are the odds? According to leading reinsurer Munich Re, the average man has a one in 12 chance of dying before age 65. The risk for women is slightly less.
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What is life assurance?
Life assurance pays out a lump sum if an insured person dies. It can be arranged either for a specific number of years (this is known as Term Assurance) or with no fixed end date (this is known as a Whole of Life policy).
Both types of policy will pay out a lump sum on your death. The difference is that with a term assurance policy this is only if your death occurs during the period you have selected cover. With Whole of Life as there is no end date, the policy pays out on your death, whenever this happens, provided you keep paying your premiums.
You can cover yourself, your partner or both of you together (a joint policy). Where two people are covered under a Whole of Life policy, it can pay out either when the first person dies (1st death) or when the last person dies (2nd death).
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As a teacher, am I covered with my job?
If you are a member of the Teachers Pension Scheme your family will automatically get a lump sum if you die in service of 3 times your salary (or full time equivalent if you work part time).
Example:
| Your earnings |
Life assurance from the Teachers Pension Scheme |
| £15,000 |
£45,000 |
| £25,000 |
£75,000 |
| £40,000 |
£120,000 |
| £50,000 |
£150,000 |
Once you know how much cover you already have, you can take a view on whether or not it is sufficient for your needs. For example, is it enough to pay off your mortgage and other debts? Will it be enough to protect your family's lifestyle until the children finish their education or your partner retires?
Also, talk to your partner, it could be they need protection too.
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I'm not a teacher, will I be insured by my employer?
Some employers include life assurance in their employee benefits package. But don't take it for granted - to be sure, please ask them about this. Even if some is provided, make sure it is enough for your needs. Also, talk to your partner, it could be they need protection too.
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How much life assurance do I need?
If you don't have any life assurance, or might not have enough, one of our Financial Consultants can help you decide how much you need. Click here to book a Financial Advice appointment.
You might want enough to pay off all your debts, provide money for your partner or family to live on plus any extras you feel are important. To help give you a steer when working out the numbers, here's a look at some typical figures:
| UK Averages |
|
| Mortgage - 1st time buyer |
£133,794 |
| Credit card debt |
£4,398 |
| Replacing family income |
£32,779 a year |
| Rearing a child |
£9,490 a year |
| Student university debt |
£5,600 per year of study |
| Wedding |
£21,000 |
| Funeral expenses |
£2,857 |
Don't forget to take the cost of living into account. In around 20 years, even low inflation (3% pa) could halve the real value of your life assurance cover.
Source data
Mortgage – 1st time buyer: www.bbc.co.uk/news, Jan 2010
Credit card debt: www.creditaction.org.uk, Jan 2011
Replacing family income: www.bbc.co.uk/news/business, March 2008
Rearing a child: www.creditaction.org.uk, Jan 2011
Student university debt: www.bbc.co.uk/news, August 2010
Wedding: www.guardian.co.uk/money, August 2010
Funeral expenses: Ageuk.org.uk, 2010
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What if I'm retiring soon?
Any life cover you get from your employer will cease when you stop work. But don't worry, even if you are in an older age bracket you may still be able to get cover if you need it.
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Why choose Teachers Assurance?
Started in 1877 by teachers - for teachers.
15,000 teachers a year in 3,000 schools in England and Wales turn to us for financial direction. (And that's excluding other teachers who phone in or email us.)
No one understands the financial needs of teachers better than us.
As a mutual friendly society our business is built on helping teachers to:
- Protect themselves and their families
- Save for the future
- Invest efficiently
- Get the most suitable advice
- Make confident financial decisions
To find out more about how we treat our customers go to the following page:
- About us - See who we are and what you can expect from us.
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What if I need your help, advice or want to apply?
If you need our help or advice, please give us a call:
0800 056 0563
8.30am to 8pm Weekdays
9am to 1pm Saturdays
To help us continually improve customer service, calls may be recorded or monitored.
Ask us for information
Our Helpline can answer any questions you have or post you an application pack for any of the products on offer.
Ask us for advice
Our expert Financial Consultants can help you choose the most suitable products for your needs, you can ask for personal financial advice over the phone or face to face .
Ask us for a school visit - Money Talks!
Book a school visit for one of our Financial Consultants to hold a free financial planning session for teachers in your school.
Our Consultants are only able to advise on our own products and services and those of selected third parties.
