Life Insurance For Stay At Home Parents
Stay-at-home parents are heroes. On any given day, they act as housekeeper, cook and taxi driver for the whole family. Although their role is precious, it's hard to put a value on the work stay-at-home parents perform as they undertake so many roles, and that's why life insurance for stay at home mums and dads exists.
Calculating your 'parent salary'
If you're a stay-at-home mum or dad, it's easy to assume that your job doesn't have a monetary value. But in fact stay-at-home parents make a huge contribution that affects families financially.
If you were suddenly unable to be taxi driver, homemaker and personal assistant to your kids and partner every single day, how much would it cost to employ someone else to do it?
Add up that total and you arrive at your 'parent salary'.
Why is life insurance for stay at home mums and dads needed?
When buying life insurance, most families cover the breadwinner first. They're the ones earning the money to cover the mortgage, bills, groceries and other payments needed to keep a roof over the family's head.
After taking a family's 'parent salary' into account, you realise that the cost of covering all the responsibilities of a stay-at-home parent can soon add up. For this reason, it is important that you consider whether you have a need to take out life insurance covering a stay at home parent as well as the main breadwinner.
Life insurance protects what matters most
There are several different types of policy you could choose from as a stay at home mum or dad; these could include level term life insurance, mortgage protection life insurance and critical illness cover.
Level term life insurance
When buying level term life insurance, you can choose how much cover you want and the length of your policy. Level term life insurance may be attractive to young families, one scenario is that you could choose a policy term that covered your family until your children are old enough to support themselves.
Learn more about level term life insurance here.
Mortgage protection life insurance
Mortgage protection life insurance is designed to cover the outstanding balance of your mortgage if something unexpected were to happen. This type of cover provides peace of mind that your dependants will be able to keep their home if the bread winner isn't around to pay the mortgage.
Read more on mortgage protection life insurance here.
Critical illness cover
Many parents take out critical illness cover at the same time as level term life insurance or mortgage protection life insurance. This type of cover pays out a tax-free sum if you are unable to work because of a heart attack, stroke or any other serious condition specified within your policy.
Discover more information about critical illness cover here.
Should you buy cover for both parents?
Taking out a joint policy may work out cheaper than buying life insurance separately for both parents. But it's important to remember you can only make one claim per joint policy, the policy will pay out only once in the event of a claim and then the policy will cease.
Purchasing a separate life insurance policy for each parent offers double the protection and in many cases it also doesn't cost too much more than buying one joint policy. That's why you may wish to consider buying two separate polices if you are exploring your life insurance options.