Term life insurance

Having the right type of insurance that meets your needs is vital, understanding all the terms is often a bit of a maze for the uninitiated...

For instance term life insurance is the type of insurance you have for a predetermined period, for example, during the term of a mortgage. This kind of cover pays out if the insured individual dies before the mortgage has been paid off, and provides mortgage protection for partner and family who might otherwise not be able to afford mortgage payments.

There are a number of points to consider before signing on the dotted line, namely:

• Before signing the insurance cover provided by your mortgage company, you should check if similar cover is available from a third-party insurer at a better rate.
• Consider whether you also need protection against critical illness and losing your job.
• Check whether other policies you have would provide sufficient cover.

Having more insurance than absolutely necessary may not be a bad thing, but for short term cover, it could be a waste of money.