Life Insurance Cover
Life insurance cover can be taken out by any individual in any circumstance. There are many different life circumstances, one of which is couples who have just gotten married.
As new couples move into the “just married” cycle a different set of circumstances generally result and some important life protection measures need to be considered.
For example, when a first home is purchased a mortgage debt of some magnitude is generally established. In the heat of the moment, and probably very excited about first home ownership, the question of mortgage repayments is addressed and deemed to be covered satisfactorily by net income generated by both husband and wife as they may both be working. However, not enough consideration is directed at answering the question - what would happen if in the unlikely event one of the partners prematurely passed away?
The likely scenario would be that the surviving spouse would need to meet the regular mortgage payments - now out of a single income and this on top of also having to cover other household and lifestyle bills. This added financial burden may simply be, and often is, unsustainable. So the house, in which the couples dreams and future aspirations had been built around, may have to be sold as an alternative funding option.
It is likely that some couples have little or no death cover in place, though sometimes cover can be in place, however, this may not cover anywhere near the amount of the home mortgage liability. If this is the case then, generally, the home has to be sold.
There is no simple solution, however, if each partner takes out readily available comprehensive life insurance, on each others life, this eliminates any stress and trauma associated with not being in a position to meet current financial obligations. Insurance proceeds would flow to the surviving spouse generally, more often than not, nominated as the sole beneficiary of the deceased’s estate. Money that is paid out is tax free and could be applied towards retiring other debts incurred, if any, besides the home mortgage.
The net result of taking out life insurance cover on each others lives, would be that the surviving spouse, at a most difficult, emotional and stressful time would end up owning a debt free home. It is worth considering life insurance cover to ensure that your family is protected in a time of distress.