Family Income Benefit

When you have a family to protect, having enough life insurance to cover your mortgage is not going to give your family the future you wanted if you were not going to be there to provide it due to early death. Family Income Benefit provides a monthly income that will last from the death of the insured to the end of the term of the policy. It is the lowest cost method of buying Life Insurance and it pays out a tax-free income. This type of benefit is particularly useful to those with a young family where the loss of one partner would put a strain on the other partner trying to juggle work and family commitments on their own. And having a guaranteed income in this situation can mean a huge difference to a families future. Take for example a family with two children aged around 9 and 11, the parents hope they will go to university, get good jobs and one day have a healthy income and family of their own. A couple of years down the line, the husband dies unexpectedly with only enough life cover to repay the mortgage. The wife and children are mortgage free but the wife can only work part time juggling all responsibilities on her own. By the time the children are of university age, they have to get a job and provide some income to help repay the debts built up in the interim years. They cannot go to university, find employment difficult to find and struggle in their own future. Of course, the wife may remarry, but if the new husband is funding his own children through university there may not be enough cash to fund another two. But with Family Income Benefit, it would pay out until the end of the term, if that is until the children are 18, 20 or even 23 years of age, they can have the option of accomplishing what they want to in education ready for a career.

Food for thought…

Family income benefit is also useful where a family have a high level of borrowing and cannot afford to cover all of it with a lump sum life insurance policy, as traditionally Family Income Benefit costs less it can be used to cover any shortfall until a families income increases sufficiently to have more appropriate cover for these circumstances. After all, even though a comprehensive level of cover is wise, some cover is most certainly better than none all.

For practical suggestions on the options available, talk to Harvey Bowes today on 02921754150

 Your home may be repossessed if you do not keep up repayments on your mortgage


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