Life Insurance for One: Do you need life insurance when you are single?

It’s quite common for people to believe that you don’t need life insurance when you are single. I mean, who would you need to leave the money to? Despite this common perception, there can be some good reasons for someone to invest in life insurance when they’re single. It can help the people around you settle your debts, estate and finance with ease.

Typically, life insurance is used to sort out your affairs. If you’re single, this may still need to be done, despite not having a partner or family. It can help to pay off debts, your mortgage or any credit cards if you were to pass away. The question is, do you really need life insurance?

You’re a mortgage holder

If you have a mortgage, it may be that you need to invest in life insurance. Some mortgage lenders actually request this. Sometimes, a single person will often have co-signer too. The life insurance policy, therefore, is set up for the equivalent of the mortgage loan.

If you pass away before your mortgage is paid off, your bank can seek repayment of the loan from your estate. However, if you don’t have enough money in your estate, it can mean that the property needs to be sold in order to pay it off. If your home is worth less than the loan, then some lenders have the right to demand the difference.

You can’t predict what will happen in the future when it comes to house prices. If you have a co-signer you may want to think about getting life insurance. In addition to this, sometimes the probate process in which your estate is distributed can be drawn out. During this time, your interest can go up on the property and the mortgage lender can demand more money to be paid.

In some cases, the property is sold and that’s the end of the matter, but you may want to check with your mortgage lender and co-signers what will happen before writing off a life insurance option.

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You have significant debts

If you have unsecured loans or credit card debt, they are normally required to be paid off in the event of a death. Companies can request it to be paid out of the estate. If there isn’t enough money in the estate, then a life insurance policy can help to repay them.

Luckily, student loans do not need to be paid unless they are private loans. Normally, this would fall to your parents or someone else who may have co-signed your loan. Similarly, some cars on finance or jointly owned credit cards could fall to any co-signers. They would have to take on the responsibility. Taking out a life insurance policy specifically to cover these debts do not have to be expensive and can help to lessen the blow.

Someone will depend on you in the future

Even if you’re single, you may still have children that will rely on you for finance. Getting a life insurance policy out can help to protect them from the financial burden of losing you. If you don’t have children, you may have ageing parents or a sibling that needs care. Life insurance can help to protect them and provide them with the care they need in your absence.

The payout can be used to pay for care, or for them to maintain their lifestyle without your support.

business owner

You work in a partnership or you’re a sole trader

You may not need life insurance in your personal life, but have you thought about what you need for your business? If you run a business, whether in a partnership or as a director or sole trader, you may want to invest in business life insurance. Life insurance when you’re single can be important if you’re a business owner.

If you pass away, it is likely that your business will close down or need finance to buy back your share. With business life insurance you can help protect your partners, employees or other shareholders by taking out a policy that goes to the business.

Business life insurance when you are single can then be used to keep the business running in the event of your death.

You want to plan for the future

Life insurance when you are single may seem like a bad idea, but it might actually be smart planning. If you want to have children one day, get a mortgage, get married or make any other plans for your future, it may be worth getting life insurance now.

Why? Because life insurance is cheaper the younger you are. The risk of you passing away increases with age, which means so does the cost of life insurance. Therefore, getting life insurance when you are single, young and healthy can be a really smart move to save money.

family medical history

You have had significant health issues within the family

Similarly, health conditions can affect the cost of your life insurance. Even if it’s health issues within the family that you may not have experienced. Insurance providers measure the level of risk you may pose to them in order to provide you with the cost of your life insurance. Therefore, significant health issues within the family history may be a cause for concern.

If you invest in life insurance now while you’re healthy, it may mean you can save some money. Parents with heritable conditions or common illnesses in the family can be a good sign that you may need to get life insurance when you are single instead of waiting until later in life.

To help your family pay for the funeral

The cost of funerals can be way up in the thousands of pounds. Therefore, getting life insurance when you are single can help relieve the financial burden of your family such as your parents. If you’re aware that your loved ones may not be able to afford a funeral, getting a small amount of life insurance for end of life expenses could really help them out.

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Leaving money to a charity

If you support a particular cause or charity, you may want to leave some money behind for them. Getting life insurance when you are single doesn’t necessarily mean it goes to your family. If you have a charity that you regularly support and would like to leave a donation in the event of your death, you can take out a life insurance policy in order to do this.

Life insurance when you are single: Protect your loved ones

No one likes to think about what might happen if they were to pass away. However, it’s really important to put plans of actions in place to protect the people around you.

In some cases, your employer may provide you with life insurance. Normally, the cover they provide will be enough life insurance when you are single. However, if you don’t have it, then it might be worth investing in a smaller policy of your own.

Getting life insurance when you are single doesn’t have to be a given, it depends very much on your own requirements. It may suit you at a different part of your life instead. Compare quotes for free and get advice from an insurance advisor to decide if it’s right for you.

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