The Orca Financial Guide to understanding
    Life Cover

    Why would I need Life Cover?

    Nobody wants to think about the worst happening, but death is a fact of life, and it’s a good idea for you to have a plan in place to protect loved ones financially in the event of death. If you or your partner dies prematurely, it could have serious implications for your family. It could mean a significant and sudden reduction in their financial wellbeing.

    • Earned income will stop.
    • Loans may become repayable.
    • Inheritance tax could arise for dependants

    While social welfare benefits payable on death, such as the widow’s / widower’s / surviving civil partner’s pension, may replace part of the earned income, the benefits they provide are low, and are designed to cover only the basic necessities of life. Putting life insurance in place can ensure that in the case of a premature death, the family will be financially secure. Your income is their most valuable asset. It’s important that you understand how your family’s standard of living would be affected if you were no longer there to provide for them.

    How much Life Cover do I need?

    Identifying the level of cover required for you or your partner will depend on your individual needs, the amount of income that would need to replaced, along with any additional expenses that may be incurred. The level of cover recommended should ensure that your family’s standard of living won’t change in the event of a sudden death. It should provide enough cover to:

    • Replace the gap in income
    • Clear any loans or mortgage
    • Ensure there is money to cover larger costs that may arise in the future, such as third level education
    • Compensate for the surviving partner / spouse having to reduce working hours
    • Cover the cost of any additional supports that may be required within the home, for example a housekeeper or cleaner

    This is the guideline on levels of life cover required, as provided by The Life Assurance Association.

    AgeMultiple of Income
    21-3020-25
    31-4015-20
    41-5010-15
    51-605-10
    61-705
    71 up5

    For a better understanding of Life Cover,
    call Orca Financial on 01 2103030
    or email info@orca.ie