Summary

It is always advisable to understand exactly what you need in the way of cover as only you know your personal circumstances.  We explain what you need to know and how to maintain it once you have it. (best loans)

What Insurance Do You Need To Protct Your Family? - Part 2

Andrew Merricks, head of investments at Brighton-based financial adviser Skerritt Consultants, warns that it is very short-sighted of people not to have Life Assurance and/or Critical Illness Insurance as he insists that life has two main risks - either living too long and dying too soon.  "Its absolutely crucial to have some cover in place – particularly if youve got a young family," he says. "These days you need to build your own little welfare state because no one else is going to do it for you."

Matt Morris at LifeSearch says now is the ideal time to buy such policies as there are some very competitive premiums around due to the fierce vying for business within the industry. "The cost of life cover has fallen – dropping about 40 per cent in five years. It has never been cheaper," he adds. "The critical illness industry paid out on 84 per cent of claims in 2006 – up from 81 per cent the previous year." (loans)

Always check what insurance cover you already have before you take out any more.  Do you already have investment policies or does your employment pension fund give you any cover?

The best way to calculate how much cover you need is to work out how much you would need to provide the same standard of living over a year and then times it by 25 years.  The minimum amount needed should pay off any outstanding debt and provide a lump sum for all your dependants. (car insurance cover)

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