What insurance do you need in your 40’s? 

When you hit your 40’s you probably have expectations about where you should be, where you want to be and the reality of where you really are. By the time you are 40 you expect to own your own property, maybe have children, have paid off your student loan and be at the peak in your career, starting to think about what’s next. This in itself can be a very scary thought. Should you be paying more towards your pension? Should you be saving more? What insurances do you need to be confident that you are protected if things go wrong?

With the future of UK economy being uncertain at the moment, every penny counts and peace of mind is worth its weight in gold! We’ve delved into the world of insurance and detailed the insurances we think you should have as you enter your fifth decade. Sorry, if this scares anyone!

What does Life Insurance cover me for?

YOLO! A phrase I’m sure you’ve all heard, you only live once! We’re often so busy these days living life, that we forget to protect the people around us should something happen to us. In our 20’s we’re busy being young, care free and single, in our 30’s we’re busy growing up and acting like adults, then you hit your 40’s, now you are an adult! Life Insurance is no longer a thing you might need to get when you’ve got a mortgage, it’s something that you really should have. Full stop.

You can either purchase a single or joint life insurance policy. It’s recommended that if you’re in a couple and can afford it, to have two separate policies. But what will your life insurance policy do for you? Your life insurance policy is there to ultimately pay out a set figure stipulated by yourself when you pass away. There are two types of payment plans, level term and decreasing. Level term means you pay one set monthly fee for the duration on the policy and if you pass away during the policy term, your family will receive one set payment. Whereas, with decreasing term, the amount you are covered for gets lower over time, meaning your pay-out will be less than what you were originally covered for. However, if you have less disposable income, it’s worth noting that decreasing term policies are often cheaper.

Do you have Life Insurance?

If you don’t have life insurance, now’s the time to get some. If you do have life insurance, it’s worth having a look through your policy to make sure it’s still relevant and will offer you the maximum benefit should you need to claim on it.

Here’s some of our top tips that you need to think about:

  • Whilst 40 might seem daunting to you, in insurance terms, you’re not that old! You’re young enough to still purchase a decent life insurance policy that will protect you and your family should something happen to you. However, you still need to move with some level of urgency as the older you get, the more your cover will cost you
  • Don’t just rely on the life insurance you may get with your company, as this can leave you drastically short should something happen to you. On average people need five to ten times their annual income in terms of life insurance, maybe even more depending on how many dependencies they have 
  • If you are buying life insurance for the first time, make sure you shop around. Not only on price comparison sites, but you can often get some good cashback deals
  • You can always buy more coverage, as your life insurance may not be as up to date as you require. Often, if you have purchased a policy say, in your 20’s, life is very different in your 40’s and you may need a higher level of cover

Have you thought about Critical Illness cover?

Have you heard about Critical Illness cover? This is an optional extra that you can add onto your life insurance policy to protect you and your family in the event that you become critically ill. You may have seen in the press over the years, people claiming Critical Illness Cover is not an essential insurance and perhaps we don’t need it. However, in your 40’s you are probably in the position that your household is relying on your income and what happens if that suddenly stops?

The price you will pay depends on the illnesses you get cover for. Naturally, the fewer the illnesses, the cheaper the cover. However, it is worth delving into your family history to see if you are potentially at higher risk of certain illnesses to make sure you are covered against those.

Ultimately, it’s your decision. Making an informed decision is important, so do your research and be guided by that.

Have you switched your car insurance recently?

How long have you been with your current car insurance provider? If it’s more than a couple of years, now’s the time to think about switching. Now you’re in your 40’s and providing you haven’t got a significant claims or conviction history, you are considered to be ‘safer’ in the eyes of the insurer, so could benefit from looking on a price comparison website.

What type of insurance do you have? Fully comprehensive or third party? As it becomes more popular for younger drivers to opt for third party insurance, the risk and therefore the price of these policies can increase. So, if you’ve got a third party insurance policy, make sure you compare the cost of a fully comprehensive policy also.

Is your home insurance up to date?

Chances are that in you 40’s you’ve managed to get on the property ladder. If that is that case, you will most definitely have buildings insurance, but when was the last time you looked at your contents insurance? Are all your specified items correct on your current policy?

We advise that you take a look at your policy documents to ensure absolutely everything is covered. It’s good practice to tally up your valuables accurately after birthdays and Christmas as the chances are you have some expensive presents that should be itemised on your policy.

Do you have annual travel insurance?

Whether you’re off on a trip to find yourself, annual ski holiday with the family, or a much needed break in the sun, travel insurance is a must. If you have a family with younger children, family travel insurance may be a good option for you. Have a good look at the products on the market as sometimes insurers have deals where children can be included for free. However, always look at the small print as you may have to pay multiple excesses for claims on some policies.

Make sure you are always honest about your medical history on your travel insurance as you never want to find yourself in a position where you need to use it, but can’t! If you have had previous medical conditions, use a price comparison website to scan the best options available to you.

Don’t forget, if you have a packaged current account, you may have travel insurance included in this.

There you have it, older and wiser! 

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