The Importance of educating your employees on protecting their families through Life Insurance

Life insurance is often deemed to be one of the most vital insurances to have. Although your employees personally may not benefit from the protection it affords, life insurance could provide invaluable financial support for your employee’s loved ones in the event of your employee passing away. 

Mintago has partnered with Cavendish Online, one of the UK’s top life insurance brokers to provide your employees with the best value for money and service available. 

How does life insurance work?

Life insurance provides a lump sum or regular payments to loved ones in the event of an individual passing away. There are many reasons as to why this type of financial protection is helpful, including:

  • Paying off a mortgage 
  • Providing support to their family or dependents 
  • Help covering funeral expenses 

What kind of life insurance plans are available?

Term life insurance 

This type of life insurance has a start and end date and a set amount that is covered. Should your employees pass away between this time their family receives a cash payout. 

However, because there is an end date it is possible that they will outlive the policy. This is why this option is one of the most cost-effective available on the market. The insurance is designed to cover people during a time when their family could be financially vulnerable if they were to pass away. This may be relevant if employees have substantial remaining mortgage repayments or children to support. 

Term life insurance can be purchased as an individual or as a couple. If your employees wish to investigate this type of life cover and decide which is most suitable for them and their families they can speak to an adviser.

Whole life insurance 

Whole life insurance is often referred to as “life assurance”. This type of protection can cover an individual from the moment the plan commences to the moment they pass away as long as premiums are paid. 

Because there is a guaranteed payout with this type of life insurance, taking out a policy can be more costly than term life insurance. However, it is guaranteed that your employees’ loved ones will receive financial aid should they pass away unexpectedly. 

Whole life insurance can be purchased as an individual or couple. 

Who needs life insurance?

There are a variety of reasons why your employees may wish to consider taking out a life insurance policy, including:

  1. They have a mortgage

Although it is not compulsory to take out a life insurance policy when your employees are approved for a mortgage, it is sensible for them to consider cover due to the large financial commitment that they are making. In the event that your employees pass away, their life insurance policy could help their loved ones clear the outstanding mortgage debt, meaning there’s one less financial burden for the family to worry about. 

If your employees have children this is especially important, as they may need financial help to continue to live in their house and be financially secure. 

  1. They have a family or dependents that need financial support 

If your employee’s partner or family would require financial support in the event of their passing, life insurance can help to provide this. This financial support could help with rent or mortgage payments, educational support, affording utilities and essentials and other everyday expenses. 

With the current rising cost of living and inflation, life insurance could be vital in ensuring that your team’s loved ones do not experience a great financial burden if your employee was to pass away. 

  1. They have family or dependents that need domestic support 

Life insurance could be used to help cover the absence of a second person/parent in the home. For example, when one person/parent passes away, there may suddenly be the need for additional domestic support or childcare.

These services can be expensive, and life insurance can help to reduce the financial stress potentially caused due to unexpected expenses that their family is not used to budgeting for. 

  1. They are concerned about the cost of their funeral 

The average funeral can cost £4,056. Unfortunately, paying for a funeral can add to the financial stress and burden felt by loved ones at a difficult time. With life insurance, your employees’ loved ones can receive help in covering funeral costs. Because these costs are often unexpected, receiving help towards some or all of the costs can prove invaluable. 

How can your employees look into life insurance?

If your employees are interested in learning more about life insurance but do not know where to begin, it is useful to encourage them to speak to a professional such as an insurance adviser. There is often no cost involved for the initial conversation and discussing quotes, however, there is usually a commission built into the monthly premiums if they decide to go ahead with the discussed policy. 

About Mintago

Mintago and our trusted partners offer benefits to users of the platform. Our partnership with Cavendish Online offers Mintago users discounted life insurance from the UK’s most affordable life insurance provider. Your employees can also take advantage of other benefits offered to them as Mintago users through the Mintago platform.

Mintago is an unbiased financial wellbeing platform offered to businesses to benefit both employers and employees. The Mintago platform gives employees the tools and education to reach their financial goals and become financially healthier.

By Mintago Team

Mintago is an FCA regulated company that helps businesses save on their workplace pension NI costs and improves the financial wellbeing of their employees. For the employer, Mintago provides a salary sacrifice pension hassle-free implementation program which creates direct savings on monthly (National Insurance) NI payments. We manage the whole process including communication, compliance and ongoing management. No need to switch pension provider, either. For the employee, Mintago’s unique financial wellbeing platform helps find lost pensions quickly, manage employee pension contributions, while helping them understand their financial situation with over 1,000 pieces of content.

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