Why renting does not rule cover out
Life insurance often gets talked about as mortgage cover, so renters sometimes skip it. Yet a tenancy is a monthly bill that someone has to keep paying. If your partner or children could not cover the rent alone, they might need to move at a time when moving is the last thing they want.
If you live alone with no dependants, you may need little or no life cover. If anyone counts on your pay, it is worth a look. That includes a partner who could not manage the rent alone, children of any age and sometimes a parent you help support.
Thinking in months rather than one big number
Homeowners often start with the mortgage balance. Renters can start with the monthly rent plus the bills, then decide how many years that support should last. For a family, that might be until the children leave school. For a couple, it might be long enough for the survivor to adjust and settle.
Family income benefit fits this way of thinking. It pays a regular sum each month from the claim until the end of the policy, and the cover amount falls over time, which keeps it affordable. If you also want a lump sum for debts or a funeral, a small level policy can sit alongside it.
- Your share of the monthly rent
- Council tax, energy and other household bills
- Childcare if a surviving partner would need it to keep working
- Moving costs if the family chose to move somewhere smaller
Planning for a future purchase
Many renters hope to buy one day. Taking out life cover now locks in a price based on your current age and health. When you buy, you can review it and add mortgage cover on top, rather than starting from scratch.
Some policies let you increase cover when you take out a mortgage, without answering medical questions again. It is worth asking about this feature if a purchase is on your horizon. The extra cover is usually limited to a set amount or a share of the original sum, so check the rules before relying on it.
Shared houses and friends who rent together
If you share a flat with friends, each person is usually responsible for their own share of the rent, though joint tenancies can make everyone liable for the whole amount. Life insurance for flatmates is uncommon, but it can make sense if one of you could not keep the place without the other.
Check your tenancy agreement and talk to each other. A small single policy in trust can cover a notice period or a few months' rent while the others find someone new. It can be a sensible step for friends who sign a joint tenancy, where each person may be on the hook for the full rent.
Funeral costs and personal debts
Even if nobody relies on your rent money, you could leave costs behind. A funeral, credit card balances, a car on finance or a personal loan would normally be settled from your estate before anything passes to your family. If the estate fell short, relatives might feel they had to step in.
A modest level term policy can cover these without straining your budget. Some renters hold it alongside savings, so the family has cash for the first few weeks while your affairs are sorted out and your bank accounts are frozen.
A tenancy does not always end the day a tenant dies. Depending on the agreement, rent may still be due for a period, and whoever handles your affairs will need to give notice and clear the home. Money in place makes those weeks far easier for them.
How Hi Tomorrow helps renters
We look at your rent, your household and your plans, then recommend cover that keeps the home running for the people who rely on you. We compare the insurers on our panel and show you how a lump sum and a monthly income option would each work.
If you buy a home later, come back to us. We can review what you hold and add mortgage protection so the two policies fit together. We do not charge a fee for this advice, and you are under no obligation to buy after speaking to us. You can also start with the online form at any time and we will call you back.