Online Life Insurance
What is online life insurance?
Online life insurance provides customers with an insurance policy that will pay out a lump sum payment to their families if they die, and is offered and managed on the internet. Online life insurance is one of the cheapest ways of buying life insurance, simply because of the lack of overheads, and is similar to buying anything online.
Customers often take out online life insurance as they want to look after their financial responsibilities, like their mortgage and children, even if the worst happens and they are no longer here. Online life insurance policies pay out a tax free lump sum to the family of a customer who dies and that money can be used to pay off a mortgage, buy a new home or to pay for a customer’s children’s upbringing.
A lot of customers are first offered life insurance when they take out their first mortgage, but with the age of the first time homeowner now reaching 38, many people have children before they buy their first home, and should potentially look at taking out online life insurance when they have their first child.
How does online life insurance work?
When a customer wants to take out an online life insurance policy, they will log onto the online life insurance website and fill in an application form, including details of their medical history and age. They will also be asked what level of cover they would like to sign up for. This is basically asking you how large you want the payout to be. Generally a customer would take out at least the value of their home, plus an extra £50,000 per child, although everyone has their own preferences.
It’s important to remember to amend your online life insurance policy when you get married and have children as you may need different levels of cover.
Once a customer has filled in all their details and chosen their level of cover they will be given a quote, and can start their online life insurance policy straight away.
If the customer was to die during the term of the online life insurance policy, the family, or person the customer had specified in their life insurance policy would be given the tax free lump sum payment, which they can use to pay off the mortgage and look after the children as required.