None of us knows how much time we have left on this planet. The good news is that your chances of living longer have never been better. Most people nowadays are likely to live to around 75 to 80 years of age. The bad news? You can never forecast when you’re going to be hit by a bus or succumb to a mystery virus.

So you should always make sure there is sufficient life insurance and cover against your succumbing to a serious illness or losing your livelihood that you can provide for your family.

So you should always make sure there is sufficient life insurance and cover against your succumbing to a serious illness or losing your livelihood that you can provide for your family. Life insurance won’t replace you, but it will replace your money-earning capacity.

As well as buying life cover, you can purchase critical illness policies that pay out a lump sum if you have a serious illness, such as a heart attack or cancer, and survive for a month. Some policies also pay if you die during the policy period. The same huge range of prices exists, so never, ever go for the first quote you get.

Some policies, known as permanent health insurances or income protection plans, promise to pay a monthly sum until your normal retirement age if you can’t work due to illness or injury. These policies can be expensive, especially for women because insurers think women are ill a lot more often than men.

So how much life insurance should one have?

This will depend upon the factors - your age, the number of dependents you have, your income and your outstanding debts.

People with young families need life insurance more than people in their forties and fifties whose children have left the family home. For a young family, the loss of a parent could mean that the surviving partner must try to maintain the family’s standard of living for 18 years or until the youngest child becomes independent. So a realistic level of life insurance cover is a must. For parents in their forties and fifties protection is still important, although cover does not have to be so extensive. Read the rest of this entry »