At these prices, life is cheap

Death may be unpalatable, but for relatives, penury can make the loss much worse.

Wasn't it shocking that the Grand National was delayed? Do you think Manchester United will win the championship again? Who will win the election? Have you seen the comet? We'll think about anything rather than consider our own mortality. But if a tragedy did happen to you, you would not be the only one to suffer. How would your family cope, not just emotionally, but financially? Unless you have taken steps to protect them, your loss could prove to be just the beginning of their troubles.

Life cover is a way to ensure that your family would be able to cope financially if - excuse me for mentioning it again - you were to die. Anyone with responsibilities knows the importance of life assurance, but around of third of British adults have no cover at all.

But, as our table shows, it costs from just a few pounds a month to set up a simple policy which will pay cash to your dependents if you die. Our figures are based on cover for pounds 50,000 but most people will want to get more cover than that.

Why? If you are the breadwinner, or one of them, you should see life assurance as a way of ensuring your loss doesn't hit your family's finances. The aim should be to replace your income, or to provide enough income to meet their future needs. The simplest and cheapest life policy is term assurance which you pay into for a certain period, and which pays out if you die within that period.

The policies pay out a lump sum on death so you need to ensure that the amount is enough to generate an adequate income for your family. For instance, if you earn pounds 30,000 a year, you should aim to have life cover of pounds 600,000. Why so high? To guarantee an annual income of around pounds 30,000 from your life assurance payout, based on the assumption that you should be able to get a 5 per cent return on your investment. If you think in the future your dependents may be able to get a 10 per cent return on an investment, then you would need to buy only pounds 300,000-worth of life cover to get a pounds 30,000 income.

Do the sums based on your own salary. Of course you may feel that your family may not need as much as you earn, particularly if some of their outgoings may be reduced on your death. You may have mortgage replacement insurance, for instance. If so you should work out their future outgoings and work out your life assurance needs accordingly.

Alternatively you could list your debts first, including the mortgage, and start by getting enough life assurance to cover them, leaving your family with a financial clean slate. Remember to include all loans or other credit debts you may have if you follow this approach. Then you should consider just how much your family would need to live on in a debtless environment and working out your life assurance needs accordingly. If both partners work then both should be covered to an appropriate level, as the loss of either income could lead to a financial strain.

The costs of assurance will depend on a number of issues. Your age, of course, will be a determining factor, as will your sex. Since females are statistically likely to live longer than men their life cover is cheaper.

You health will play a big part in determining the cost of cover but as long as you are reasonably healthy, you shouldn't need to undergo a medical to get life cover, unless the insurance company demands it because of your age.

However they will not take it on trust and you will need to supply a note from your doctor attesting to your general condition. As you can see from the table, costs vary considerably between insurers with, in some cases, cover costing as much as three times more. This means that it is sensible to shop around - but it is equally important to check the small print. Some polices may have exclusions or omissions which concern you. Exclusions could be anything which render the policy invalid and it is important to understand what they are. Omissions could be inadequate cover - for instance, some more expensive policies pay out immediately if you are diagnosed with a terminal illness and have less than 12 months to live.

Getting the right cover is important so you should make sure you understand what is being offered. You may want to take expert advice to ensure you do not make a mistaken

Life cover - what it costs

Lowest and highest monthly premiums for pounds 50,000 of level term assurance for a non-smoker. Lowest rates in all cases were from Equitable Life; Highest rates quoted came from various providers as shown

Low High

10-year term

Male aged 30 pounds 3.75 (Equitable ) pounds 12.00 (Winterthur)

Female aged 30 pounds 2.67 (Equitable) pounds 11.00 (Ecclesiastical)

Male aged 40 pounds 6.65 (Equitable) pounds 20.00 (Ecclesiastical)

Female aged 40 pounds 5.33 (Equitable) pounds 16.00 (Ecclesiastical)

Male aged 50 pounds 16.75 (Equitable) pounds 39.50 (NM Life)

Female aged 50 pounds 12.03 (Equitable) pounds 37.50 (Scot.Friendly)

15-year term

Male aged 30 pounds 4.16 (Equitable) pounds 12.50 (Winterthur)

Female aged 30 pounds 3.11 (Equitable) pounds 11.00 (Ecclesiastical)

Male aged 40 pounds 8.42 (Equitable) pounds 22.00 (Ecclesiastical)

Female aged 40 pounds 6.35 (Equitable) pounds 17.50 (Ecclesiastical)

Male aged 50 pounds 21.94 (Equitable) pounds 46.50 (Winterthur)

Female aged 50 pounds 14.80 (Equitable) pounds 40.00 (Utd. Friendly)

20-year term

Male aged 30 pounds 4.91 (Equitable) pounds 13.50 (AXA E&L)

Female aged 30 pounds 3.62 (Equitable) pounds 13.50 (Utd. Friendly)

Male aged 40 pounds 10.56 (Equitable) pounds 26.00 (NM Life)

Female aged 40 pounds 7.64 (Equitable) pounds 24.00 (Utd. Friendly)

Male aged 50 pounds 27.94 (Equitable) pounds 60.00 (NM Life)

Female aged 50 pounds 18.36 (Equitable) pounds 56.50 (Scot. Friendly)

Source: Moneyfacts

Start your day with The Independent, sign up for daily news emails
Have you tried new the Independent Digital Edition apps?
Arts and Entertainment
The Apprentice candidates Roisin Hogan, Solomon Akhtar, Mark Wright, Bianca Miller, Daniel Lassman
tvReview: But which contestants got the boot?
Arts and Entertainment
Jim Carrey and Jeff Daniels ride again in Dumb and Dumber To
filmReview: Dumb And Dumber To was a really stupid idea

Jo from Northern Ireland was less than impressed by Russell Brand's attempt to stage a publicity stunt

Scunthorpe goalkeeper Sam Slocombe (left) is congratulated by winning penalty taker Miguel Llera (right)
Life and Style
A woman walks by a pandal art installation entitled 'Mars Mission' with the figure of an astronaut during the Durga Puja festival in Calcutta, India
techHow we’ll investigate the existence of, and maybe move in with, our alien neighbours
Arts and Entertainment
Sir Ian McKellen tempts the Cookie Monster
tvSir Ian McKellen joins the Cookie Monster for a lesson on temptation
Tourists bask in the sun beneath the skyscrapers of Dubai
travelBritish embassy uses social media campaign to issue travel advice for festive holiday-makers in UAE
Arts and Entertainment
Jennifer Saunders stars as Miss Windsor, Dennis's hysterical French teacher
filmJennifer Saunders and Kate Moss join David Walliams on set for TV adaptation of The Boy in the Dress
Life and Style
Nabil Bentaleb (centre) celebrates putting Tottenham ahead
footballTottenham 4 Newcastle 0: Spurs fans dreaming of Wembley final after dominant win
Life and Style
Sebastian Siemiatkowski is the 33-year-old co-founder and CEO of Klarna, which provides a simple way for people to buy things online
Finacial products from our partners
Property search
Pat and Richard Astbury at their home in Norton Canes, Staffordshire. They have benefitted from the Community Energy Project aimed at helping council tenants with their energy bills. They have had solar panels installed.

Locals in Staffordshire to save hundreds after new council-backed project to install solar panels

The sun is shining on people who struggle to heat their homes and it’s thanks to a sense of community

Gross household debt reached a historic high of around 160 per cent of combined incomes in 2007

Simon Read: Give people struggling with debt some breathing space

Struggling people need help, understanding and forbearance, not ill-thought-out pronouncements

A person walks through the City of London during the early morning rush hour in London

Simon Read: Caught up in the scandal about leaks at the regulator

You won’t find me bashing the banks for the sake of it, but sadly they’ve deserved all the criticism that’s been sent their way in recent years

There were around 750,000 victims of mobile phone theft in England and Wales last year, according to official figures

Money alert: Stolen mobile phones

Gillian Guy, chief executive of Citizens Advice: 'The injustice of shock bills for crime victims must end. The Government must stand up for consumers and cap bills from lost or stolen phones at £50'

Indian workers boil sugarcane juice to make jaggery, a traditional cane sugar, at a jaggery plant in Muradnagar, Uttar Pradesh's Ghaziabad district

Mark Dampier: A hot investment story is taking shape as India lets the light in

Stirring the pot: the Indian Government’s reforms of labour rules offer hope of a brighter future for businesses 

An AA patrol man helping a woman whose scooter had broken down.

Bargain hunter: Whisk up those leftovers instead of just throwing them in the bin

Knight of the road, look out: you’ve got a new rival 

How to raise money for charity this Christmas

There are so many ways you can raise money - and awareness - for charity. Rob Griffin explains how easy it is to donate and reap financial rewards

Simon Read: The Chancellor has stamped on an unfair tax. But will the delight of homebuyers mean misery for others?

Were you surprised by the sudden reform of the rules for stamp duty on property purchases? I certainly was. I've been calling for ages for a change in the tax to make it more fair – and, at a stroke, George Osborne did just that on Wednesday in his Autumn Statement.

Santander, whose ads have been fronted by the Olympic gold medallist Jessica Ennis-Hill, was among the banks where there were potential pitfalls with shared licences

Best savings rates are not all they might seem

Consumers can sometimes think they are shopping around for a rewarding account when in one important aspect, writes Samantha Downes, they are not
The sunlit uplands: switching out of a final salary pension may seem like madness, but there could be cases where it makes sense

Gold-plated pensions – the key to retirement freedom?

With some people are weighing up whether they will be better off cashing in their final salary pension next spring, Samantha Downes asks the experts

Sarah Bibby and Robert Allinson, with their children Charlotte and Ethan, confronted the ‘difficult’ questions’ posed by making a will

Simon Read: There may be trouble ahead for cohabiting couples who don’t make a will

Your children have it all, your partner gets nothing

Halfords is gearing up for Christmas

Bargain Hunter: Find the deals that have real value beneath the Black Friday hype

Halfords is gearing up for Christmas

Fields of dreams: venture capital trusts help young companies to grow, potentially delivering big returns for investors

Mark Dampier: You take a chance but VCTs have sorted the wheat from the chaff

Fields of dreams: venture capital trusts help young companies to grow, potentially delivering big returns for investors 

The FCA has imposed £1.1bn in fines on five banks over forex trading practices

Simon Read: Catch 22 for borrowers who are turned down by banks

There are many reasons for people to turn to high-cost credit, but being turned down by their banks for a loan is one

The battle between the banks to attract more current account customers moved up a level this week when Yorkshire Bank (and Clydesdale Bank) launched a market- leading £150 switching incentive.

Money Insider: Would £150 make you switch banks?

The £150 incentive from Yorkshire and Clydesdale runs from now until 28 February next year, but you must use the official Current Account Switching Service (CASS) and close your existing account to qualify

Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating

By clicking 'Search' you
are agreeing to our
Terms of Use.

ES Rentals

    iJobs Job Widget
    iJobs Money & Business

    Ashdown Group: Java Developer - Hertfordshire - £47,000 + bonus + benefits

    £40000 - £470000 per annum + bonus: Ashdown Group: Java Developer / J2EE Devel...

    Ashdown Group: Direct Marketing Manager - B2C, Financial Services - Slough

    £45000 - £55000 per annum + Benefits: Ashdown Group: An exciting opportunity h...

    Carlton Senior Appointments: Sr Wealth Manager - San Francisco - Inv AdvisoryFirm

    $125 - $175 per annum: Carlton Senior Appointments: Senior Wealth Manager – In...

    Carlton Senior Appointments: Private Banking Manager - Intl Bank - Los Angeles

    $200 - $350 per annum: Carlton Senior Appointments: Managing Producer – Office...

    Day In a Page

    Jeb Bush vs Hillary Clinton: The power dynamics of the two first families

    Jeb Bush vs Hillary Clinton

    Karen Tumulty explores the power dynamics of the two first families
    Stockholm is rivalling Silicon Valley with a hotbed of technology start-ups

    Stockholm is rivalling Silicon Valley

    The Swedish capital is home to two of the most popular video games in the world, as well as thousands of technology start-ups worth hundreds of millions of pounds – and it's all happened since 2009
    Did Japanese workers really get their symbols mixed up and display Santa on a crucifix?

    Crucified Santa: Urban myth refuses to die

    The story goes that Japanese store workers created a life-size effigy of a smiling "Father Kurisumasu" attached to a facsimile of Our Lord's final instrument of torture
    Jennifer Saunders and Kate Moss join David Walliams on set for TV adaptation of The Boy in the Dress

    The Boy in the Dress: On set with the stars

    Walliams' story about a boy who goes to school in a dress will be shown this Christmas
    La Famille Bélier is being touted as this year's Amelie - so why are many in the deaf community outraged by it?

    Deaf community outraged by La Famille Bélier

    The new film tells the story of a deaf-mute farming family and is being touted as this year's Amelie
    10 best high-end laptops

    10 best high-end laptops

    From lightweight and zippy devices to gaming beasts, we test the latest in top-spec portable computers
    Michael Carberry: ‘After such a tough time, I’m not sure I will stay in the game’

    Michael Carberry: ‘After such a tough time, I’m not sure I will stay in the game’

    The batsman has grown disillusioned after England’s Ashes debacle and allegations linking him to the Pietersen affair
    Susie Wolff: A driving force in battle for equality behind the wheel

    Susie Wolff: A driving force in battle for equality behind the wheel

    The Williams driver has had plenty of doubters, but hopes she will be judged by her ability in the cockpit
    Adam Gemili interview: 'No abs Adam' plans to muscle in on Usain Bolt's turf

    'No abs Adam' plans to muscle in on Usain Bolt's turf

    After a year touched by tragedy, Adam Gemili wants to become the sixth Briton to run a sub-10sec 100m
    Calls for a military mental health 'quality mark'

    Homeless Veterans campaign

    Expert calls for military mental health 'quality mark'
    Racton Man: Analysis shows famous skeleton was a 6ft Bronze Age superman

    Meet Racton Man

    Analysis shows famous skeleton was a 6ft Bronze Age superman
    Garden Bridge: St Paul’s adds to £175m project’s troubled waters

    Garden Bridge

    St Paul’s adds to £175m project’s troubled waters
    Stuff your own Christmas mouse ornament: An evening class in taxidermy with a festive feel

    Stuff your own Christmas mouse ornament

    An evening class in taxidermy with a festive feel
    Joint Enterprise: The legal doctrine which critics say has caused hundreds of miscarriages of justice

    Joint Enterprise

    The legal doctrine which critics say has caused hundreds of miscarriages of justice
    Freud and Eros: Love, Lust and Longing at the Freud Museum: Objects of Desire

    Freud and Eros

    Love, Lust and Longing at the Freud Museum