Do I need life insurance if I have a death in service?

Death in service benefits may not give the protection you need

Answer

Some employers provide death in service benefits which will usually give the employee a tax-free lump sum if they die while they still work for them. In many cases, it is tied to being part of the company pension and the amount paid will depend on the scheme.

However, death in service is not necessarily a replacement for life insurance. Often, it won't provide as much cover needed to provide for your family and it can't be assigned to repay a mortgage.

Something else to consider is that the benefits stop if you change employer, so to maintain cover you'll need to set up a separate policy. Rates for Life Insurance will be more expensive when you get older and future medical conditions can increase this further.

Lastly, with Life Insurance you have more options to fit your needs. For example, you can decide on the cover, term, who the money goes to when you die and take decreasing cover to repay a capital and interest mortgage.

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