Family Life Insurance: Explained

What is Smart Family Life Insurance? 


Life changes all the time whether we want it to or not. Our priorities change as time goes on too. 


One of the biggest changes that many people experience is starting a family. Making sure your family is protected doesn’t have to be complicated. 


With Life Insurance, you can get yourself peace of mind that should the worst happen your family can carry on living.


When you look at the benefits of getting your life insured it just makes sense. Deciding to get your life covered could be the most important thing you ever do. 


Our Family Life Insurance is perfect for when you want to protect those closest to you. There are plenty of great features to this policy.  We can understand that it can be a little confusing at first. So, in this article you’ll find all the details of the Smart Family Life Insurance. 


No matter your circumstances, it's important to know that your family are protected. 


Why is Family Life Insurance Important?


With living costs rising all the time it can be hard to see the benefit of a Life Insurance policy for you and your family.  There are short term and long-term benefits to getting it sorted out.


If you were to pass away, how would it affect your family? Could your family afford the additional costs?


Even if you’re not the primary breadwinner it's important to consider it. With childcare costs alone rising all the time it could be overwhelming. 


With Smart Life Insurance, you can make sure you leave something behind for those you care about most. 


How Can Family Life Insurance Help? – A Short to Long Term View


Sometimes it can be hard to visualize how Life Insurance might help your family. Even thinking about death can be tough.

We reckon it does help to look at how you could benefit from Life Insurance.  


In the short term


The first few weeks can be the most stressful. Between getting over the shock and taking care of the kids it can be a lot to cope with. 

Not having to worry about money can be a huge relief. It wouldn’t change what happened, but it could be some comfort.


In the medium term


As the grief starts to settle, there can be a lot of ups and downs. Organizing mortgage payments, clearing debts and utility bills are all things that Life Insurance can help with. 


Not to forget who will look after the kids. A Life Insurance benefit can mean that your kids’ education can be looked after. Not to mention everyday things like uniforms, books and equipment. 


In the long term


As the years go by, your family will experience the real long-term benefit of life insurance. As your kids grow up, they will remember you as someone who helped to give them financial security. The relief of knowing that they have had a financial helping hand can be a lasting legacy for your kids.


How much will my policy cost?


Before having an idea for how much the policy will cost there are a few things we need from you. 


First, you need to decide your benefit amount. It can be a tough decision, especially when you’re trying to decide how much money your family might need. 


Here’s an overview of the kind of benefit amounts we can offer based on age: 


  • 18 to 44 - £60,000 to £750,000
  • 45 to 54 - £60,000 to £400,000
  • 55 to 59 - £60,000 to £250,000
  • 60 to 64 - £60,000 to £150,000


It can almost seem like trying to predict the future. If you’re still feeling confused a good way to get an idea is to consider the following points:


  • Your Current Age
  • The ages of your children and how long you’d like to help them out
  • Your mortgage or monthly rent amount
  • Your outgoing per month, things like childcare, food shopping and other expenses
  • Your household income. How much is your salary and other sources of income?
  • Your debts, things like bills, loans and credit cards
  • Any savings or existing cover you have


Once you’ve decided what benefit amount you require, you’ll need to get in contact with us. From there we’ll ask you some  health and lifestyle questions. Don’t worry though you won’t need to supply us with a medical. 


It’s vitally important that you are completely honest with these questions.  If you aren’t completely honest, you may not be entitled to the final payment.


Do I need an Age Based or Level Policy?


Now that you’ve decided that it’s a good idea, you’re probably wondering how much Family Life Insurance will cost. We know that no two families are the same. 


The first major difference is between an age based and a level policy. 


Age Based Policy


With an age-based policy your pay-out amount will increase over time. Every year on the anniversary of your policy your premium is recalculated. This recalculation is based mostly on your age. As the name might suggest, the premiums increase as you get older in age.  


Another feature of an age-based policy with Smart is the automatic 5% benefit amount increase which occurs every year for the first 10 years of the policy.


So, for example if your benefit amount is £100,000, after one year it will increase to £105,000. By the 10th year the benefit amount will have increased to £150,000. 


This increase in the benefit amount can be a great way to help future proof the policy. Allowing for things like growth of the family or a new mortgage. However, you should bear in mind that the increase in benefit amount will directly increase your monthly premium. You  can opt out of this benefit at any stage in the first 10 years  in which case your premiums will increase each year in line with your age only. 


An age-based policy is something that you can keep for the rest of your life. However, this is dependent on payment of your premiums. If you were to miss two consecutive months of payments, then the policy will be cancelled, and you won’t get any money. 


Level Policy


This type of policy could give you  more certainty. With age based your premium will increase in line with your age and any applicable benefit amount increases. Whereas with a level policy your premium will stay the same each year. 


You will have to choose the length of time that this policy lasts, so unlike the age-based policy it will come to an end. The terms are between 10 to 40 years and the policy must end by the policy anniversary following your 79th birthday. 


That means once you get to the end of the policy your cover comes to an end  as there is no cash in value. This policy also depends on the payment of your premiums.


If you were to miss two consecutive months of payments, then the policy will be cancelled, and you won’t get any money. 


How do I set up a Smart Family Life Insurance policy?


So, once you’ve settled on the type of policy and benefit amount you require, you’ll need to get it set up. 


The quickest way to do this is to give us a call for free on 0800 977 6057 or register for a free call back. You’ll get in contact with our award-winning UK based call centre. From there we’ll take you through everything step by step.


After a short conversation we’ll give you a no obligation quote. If you choose to take your application further, you could be covered right there and then . 

Once that’s all sorted out, you’ll get all the documentation sent out to you in the post. As we’ve mentioned above with an Age Based policy your monthly premiums  will be recalculated every year. With a level policy your monthly premiums  won’t change. 


As long as you keep paying your premiums you and your family are protected  for the selected policy term.


Can I make any changes to my policy? 


Life can be unpredictable, and things can change quickly. Things like a growing family or a changing mortgage may mean you need to update your policy. 


You can apply to make changes to your policy at any time. However, you need to bear in mind that any changes you want to make could be subject to an additional premium. 


You should also  bear in mind that we can’t guarantee that we can accept your changes. If your changes are accepted, you will get a confirmation of them sent out to you. 


You will be made fully aware of all changes in premiums before the new schedule is set up.


How long does the policy last? 


With Smart Life Insurance the length of time the policy lasts depends on whether you’ve chosen an age based or a level policy. 


With the age-based policy, as long as you pay your premiums, the cover is for the rest of your life. This is the case even if your health and circumstances change. 


When it comes to the level policy type, the policy will last as long as the terms you’ve selected. As mentioned above, the length of time is anywhere from 10 to 40 years. Another thing to note is that you will be covered until the end of your chosen term or after you reach age 79, whichever is sooner. 


Of course, you can cancel your policy at any time. It is important to remember that if you do cancel you will not get any of your premiums back.


What are the benefits of choosing Smart Life Insurance? 


There are a lot of insurers out there promising everything under the sun. It’s perfectly reasonable to wonder why you should go with us. Well there are a few  benefits to choosing Smart Life Insurance. 


Smart Cashback®


One benefit to choosing Smart Life Insurance as your insurance provider  is that you can avail of the Smart Cashback®. With this you’ll get 10% of your first year’s premium back. So, after your 12th successful monthly payment  you’ll be automatically paid within 14 days. 


Award Winning Customer Service


In 2019  we were awarded the Gold Trusted Service Award by independent review site Feefo. Our UK based call centre is here to provide you with the highest standard of customer care. We’ll be there for you every step of the way. 


Not only this but our Family Life Insurance has been rated number 1 by Fairer Finance for Customer Experience. So, you know you’re in good hands. 


These are just some of the great benefits to not only choosing Smart, but getting life insurance. If you want to find out more, we have a great article that breaks down some of the benefits in getting Life Insurance. There might even be a few you didn’t even think about!


Are there any additional covers I can get?


If you’re looking for greater peace of mind, we offer a few optional covers. These all come with their own terms and conditions but here is a brief overview of what you can expect if you decide to go for them. 


Children’s Cover


Rather than just getting yourself covered you can add children’s cover for an  additional premium. It can help in the case of a specified serious injury or illness.


This refers to injuries or illnesses that result in permanent irreversible symptoms. The benefits range from £10,000 to £30,000 and accidental death is also covered with the policy. 


Critical Illness Cover


If you suffer a serious illness like cancer – excluding less advanced cases, heart attack of specified severity or stroke - resulting in permanent symptoms you can get up to 50% of your benefit amount depending on how much cover you select. You choose how the money is spent. 


This can assist with things like rehabilitation, income replacement or even a holiday for recuperation. You can apply to add this cover if you have Smart Life Insurance for this cover if you have Smart Life Insurance. This cover can be added later after you have been accepted. 


Accidental Death Cover


For an  additional premium, you can add accidental death cover to your Smart Life Insurance. The benefit amounts can go up to £650,000  depending on your age. If you die in an accident your loved ones could get  the chosen benefit in addition to your Smart Life Insurance benefit. 


We can’t predict when an accident could happen, but this could help  your family experience as little financial hardship as possible. 

There are terms and conditions that apply to all these optional covers. You’ll find all the details right here  .


How can my family claim my Life Insurance Benefit?


Even though you might be protected it doesn’t make it any easier when tragedy does strike. At Smart we are dedicated to making the claims process quick and easy. 


There are three ways that your family can claim in the event of your death:


  • Call us for free on 0800 458 6901,  Monday to Friday 9am to 7pm. 
  • Email us at claims@smartinsurance.co.uk 
  • Write us at: Smart Insurance, PO Box 4555, Slough, SL1 0TT


We will send your family out a claim form. Once its been completed and sent back we will assess  the claim as soon as possible. 


What are the risks involved?


You might be thinking right now “It sounds great but, what’s the catch?”. Like everything in life where money is concerned, nothing comes without risks. Here are a few things you need to keep in mind when getting Family Life Insurance. 


No Cash-In Value


The first thing to remember is that  there is no cash-in value at any time. So, if you cancel your policy you won’t get any of the premiums that you’ve paid in. It can seem like an insurance policy is like a savings account. However this is the biggest  difference between the two. 


Inflation May Reduce the value of your Benefit Amount 


The second most important thing you need to bear in mind is that inflation may reduce the value of your benefit amount. As time goes on the cost of living increases. While the benefit you’ve selected might seem like a lot today, in 10 years its buying power might be reduced. 


Unpaid Premiums


Another thing to bear in mind is what happens when premiums aren’t paid. 

If you miss two monthly payments in a row the policy will automatically end. As soon as one payment is missed, we will attempt to get in contact with you immediately. 


Affordability


As we’ve mentioned before, if you choose an aged based policy every year your premium  will be reviewed each year. This means that the monthly premium  payable will increase every year. Unfortunately, if you can’t pay your premium your policy will end. 


Can I put my policy into trust?


As it stands in the UK, Life Insurance payouts are not subject to income tax or capital gains tax. In some cases your family will get the money in its entirety. 


However, if you don’t set up your policy in a certain way it could be subject to inheritance tax.  You may be able to avoid inheritance tax by using an appropriate trust.


With Smart Life Insurance you can put your policy into trust after you take it out. Setting up a trust can be a complicated process. If you are thinking of setting up a trust, we would suggest you seek legal advice.