When nobody relies on your income
Life insurance exists to help the people left behind. If nobody depends on your income, a big policy may not be needed. Your estate would pay your debts and any funeral costs, and what remains would go to your family.
You may still want a policy if you support a parent, help a sibling or want to leave a gift to someone. Many single people also want to make sure their funeral would not be a burden.
If you have a partner but do not live together, you may still want to leave them something. A trust lets you name them as a beneficiary, which a simple will alone may not do as quickly.
Owning a home on your own
If you have a mortgage in your sole name, your family would usually have to sell the home to repay it. That may be fine. Some single owners would rather the debt was cleared, so a parent or sibling could keep the home or sell it without pressure.
Decreasing cover that follows a repayment mortgage is often a low-cost way to do this.
If you co-own a home with a friend or relative, each of you could take cover payable to the other. That gives the survivor money to buy out your share or carry on paying the mortgage.
The bigger risk is being alive and unable to work
When you live alone, there is no second salary. If a long illness stopped you working, you would rely on sick pay, savings and state benefits. For many single people that would not cover the mortgage and bills for long.
Income protection pays a monthly benefit after your deferred period until you return to work or the policy ends. Critical illness cover pays a lump sum on diagnosis of a listed condition, which can clear debts or fund time off.
Single people sometimes worry about care costs later in life too. Income protection does not cover care, but building savings and pensions while you are working helps. Critical illness cover can also fund adaptations to your home if you needed them after a serious illness.
Making a will
Without a will, your estate passes under the intestacy rules, usually to parents, then siblings. If you would rather leave money to a friend, a godchild or a charity, you need a will.
A life policy can also be written in trust for anyone you choose, so the money goes where you intend without waiting for probate.
Check your pension nomination too. Without a nomination, the scheme decides who receives any death benefits, which may not match your wishes.
How Hi Tomorrow helps single people
We look at what you own, what you owe and who you want to look after. If life cover is not a priority, we will say so and focus on the cover that would protect you if you were ill.
We compare income protection and critical illness options on our panel and explain the trade-offs clearly.