It’s pretty obvious that the main advantage of having a life insurance policy is that upon your death, your loved ones are provided for financially.

If you’re working, that’s even more important because your partner won’t have your income coming into the household. And let’s face it, the costs of raising a family increases year on year.

For a child born in 2016, parents can expect to spend £231,843.

It’s not cheap, so naturally, the key benefit you get with life insurance is the assurance that your loved ones are financially provided for.

That is of course, provided you take care when arranging your cover to ensure they do have adequate protection to cover debts, funeral expenses and money left over to take care of their future(s).

With that in mind, here are…

6 of the top positives to life insurance that most overlook

• IHT planning

It’s only natural that you want your estate to be left to your loved ones and not be swallowed up by a huge Tax Bill for Inheritance Tax from HMRC.

Should your entire estate be worth in excess of £325,000, IHT will be payable. As such, it pays to plan carefully (while you can) to help steer your family clear of tax bills upon payment of your life insurance policy, and the execution of your will.

Also worth noting is that for married couples, should the threshold not be reached on the death of the first person, the joint threshold of £650,000 will apply on the death of the second partner. Therefore, should the estate pass to a husband or wife, and then be left to family, a joint threshold of £650,000 would apply to the death of the second person, which could see a higher than expected IHT bill due to finances paid out from the first death insurance pay out.

The first £325,000 of your estate left to loved ones is tax free. Go over that and there will be 40% inheritance tax to pay. For a single person with an estate valued at £500,000, that would leave £175,000 taxable assets, for which you’re loved ones would be taxed 40% on at a cost of £70,000.

That’s a lot of money to go to the taxman, therefore if you feel your estate is going to be valued above the threshold, you do need to plan for inheritance tax or your family will be left with a sizeable bill.

So long as you have a whole-term life insurance policy and know the cash value that will be added to your estate, you can forward plan with a financial advisor to get your tax affairs in order and minimise the amount of inheritance tax your family would be liable for.

• Mortgage Protection

Without a separate life insurance policy that you set up independently for your family’s future upon your death, you’ll find that any lenders will want you to take out a life insurance protection policy alongside your mortgage. There are two types of these. Level term does not change over the term of the policy. This type is ideal for interest only mortgages when the value of the loan remains the same.

The other type of policy is decreasing term cover. This will decrease your pay out the longer you pay into it because it’s only designed to cover the outstanding balance of your mortgage. Upon the death of the policy holder, the insurance beneficiary would be the financial institution for which they’d receive the payment in full for your home.

Upon execution of your will, your homes ownership can transfer to whoever you nominate and the home will be paid for under the decreasing term life insurance policy. These are your cheapest option and the reason for this is because they only pay the outstanding balance of your home and do not have any cash value. Your mortgage is paid for and that’s it.

If you want your insurance policy pay out to go further for your family, you need to an independent policy, although a decreasing term policy alongside your mortgage can ensure your family keep more of your policies pay out money.

Remember, there are no limits on the amount of life insurance policies or types you take out. Just remember they will only pay while premiums are maintained.

Should you still have a mortgage a decreasing term policy attached to it can save your family having to dip into the money left to them from any other policies to cover the outstanding payments on the mortgage.

• They can be investments with tax advantages too

If you’re looking to maximise your tax efficiency, there’s also life assurance policies. These aren’t the same as insurance though.

With life insurance, you’re protected in the event of your death. If your policy is term life insurance, you’re only insured if you die during the fixed term period.

Life assurance is a definite because you’re not insuring in case you die; you’re assuring that your family gets a pay out when you die.

In other words, life insurance is if you die within a fixed period if it’s a term life policy, whereas assurance, since death is a certainty, you’re financially protecting your family for when you die. Not if.

The difference with life assurance is that it can be an investment product. That’s provided the policy meets the qualifying criteria.

As with any investment, you do need to take professional advice, in particular when you’re looking to invest in life assurance policies, rather than life insurance because you will need to ensure the product you invest in meets the specifications to qualify for tax relief.

Approached correctly, life insurance can be beneficial while you’re living and even more so when you’re gone. Most take the approach of only using these policies to cover their loved ones in the event of their death, which is what they are designed for.

However, you can get advantages while you’re alive. You just need to know what you’re after, what’s available in the insurance market and how to go about investing for tax advantages today, while minimising IHT when you do die.

• You’re insured for the future

Nobody ever knows what’s around the corner. If you’re healthy just now, this is the time to insure yourself because the most affordable policies are for healthy individuals, non-smokers and preferably moderate consumers of alcohol, if not tee-total. In other words, if you pay attention to your diet, keep yourself in shape and look after your health, you’ll get favourable quotes from life insurance providers.

The advantage to doing this now is that if you do develop any conditions later, you’re already covered. Following a diagnosis of any health condition, you’ll usually need to find a specialist provider, agree to exclusions usually meaning that if your death is linked to a pre-existing condition, the insurance policy won’t pay out.

When you invest early into a life insurance policy, you’re essentially protecting your insurability in the future.

• Charitable tax-free donations

There’s many a person who have charities close to their hearts. Whether it’s the SPCA, McMillan Nurses, or Cancer Research, it is possible to leave some of your proceeds to the charity of your choice and they’ll receive the cash as a tax-free payment.

You don’t need to name a charity as a primary beneficiary. You can opt to include them in your will so that when your will is executed, the money you know you’re insured for is divided in the way you intend it to be used. This way, if you’re someone who does regular events and your charity will be losing financially when you’re gone, you can leave them some proceeds through your will.

• Business Survival

If you run your own business, there’s likely to be a temporary cash flow problem upon your demise. Your life insurance policy could be the survival life line your company needs to see it through a cash flow crisis.

On the other hand, provided you have planned an exit strategy to sell your firm to provide further cash to your loved ones, they can use the proceeds from your life insurance policy to fund a sale of the business, perhaps bringing aboard specialist expertise to raise your companies profile and get maximum profit from the sale

According to new research, 30 percent of Britons do not have a life insurance policy.

Only four out of ten adults in the UK currently have life policies in place.

The rest have not invested in this benefit, instead spending money on things like mobile phone insurance and high-priced caffeinated beverages.

Over time, these smaller expenses add up to much more than the cost of a life insurance policy, which may cost just 17p per day.

With the myth that life insurance is too expensive laid to rest, we tackle other common life insurance myths.

Unmarried, Childless People Should Consider Life Insurance

Many people believe that they do not need life insurance unless they have a spouse or children. The truth is that even a single individual with no dependents can benefit from having a life insurance policy.

The payout can cover funeral costs so the executor or the administrator of the estate does not need to find a way to pay these. The cash limit of social welfare is £700 but the average cost for a funeral is £2,000. Life insurance can be used to pay for the difference.

Employer Cover May Not Be Sufficient

Workers who receive life insurance cover as an employee benefit may think that independent cover is unnecessary. In many cases, the level of employer-provided cover is not enough to meet the needs of surviving family members upon your death. In addition, leaving the job and failing to convert the policy to an individual plan may leave no life cover in force.

Stay-Home Parents Should Consider Life Insurance

A stay-home parent may assume that life cover is only necessary for the breadwinner in the family. However, parents who stay home make financial contributions to their households by eliminating the need for paid childcare.

To ensure that a surviving parent can pay for childcare and other expenses that may have been eliminated due to one parent staying home, both parties should consider insuring their lives.

Shopping for Life Insurance Is Not Complicated or Time Consuming

Many people avoid shopping for life insurance because they do not understand the terminology or have limited free time to devote to this process. An insurance website or advisor can explain all the terms used in the industry and help an individual find the most suitable type and level of life cover.

By comparing cover online, consumers can find affordable prices from online brokers that rebate some or all of the commissions they are paid by insurance companies.

Going without life insurance is a risky approach that can backfire. Learn more about the different types of cover and features of each. If questions arise during the research stage, write them down and ask an insurance professional for the answers.

Comparison-shop to find the lowest quotes for the desired cover and read the fine print before signing any documents. Then, relax and enjoy life without worrying about how surviving loved ones will cope financially after you die.

Last week, UK regulators approved the sale of the asset management and life insurance businesses of The Co-operative Group to Royal London for £219 million.

The Financial Conduct Authority and Prudential Regulation Authority approved the Royal London plan to fill a large gap in its finances and allow it to enter the Stock Exchange.

The sale should go through at the end of July and CIS will then become a limited company with the name of Royal London (CIS).

History of the Co-operative Insurance Society

In March 2013, The Co-operative Group announced the intention to also sell its general insurance operations. If this transpires, it will mark the end of nearly 150 years of co-operative insurance within Britain.

The Co-operative Insurance Society (CIS) was established in 1867, providing fire insurance for retail societies that were a part of the co-operative movement.

When it was taken over by the co-operative wholesale societies in 1912, CIS became part of The Co-operative Group.

After a £138million profit the year before, the company suffered a £662million loss in 2012. A poor economy was blamed for this disappointing performance and the company made some moves to counteract the effects.

Its insurance arm was put up for sale so the company could strengthen its capital position and begin focusing on its banking activities.

Between the end of 2012 and first quarter 2013, the core tier-one capital ratio of the bank, used to measure financial strength, increased from 8.8 to 9.2 percent, exceeding the regulatory minimum.

Co-operatives Flourish Elsewhere

Britain may seem to be shunning co-operative insurance but this cover is flourishing in other parts of the world. Co-operatives who want to insure with their own rather than using a commercial insurer have led to the establishment of several successful co-operative insurers.

Established in 1951, Zenkyoren is currently the largest co-operative in the world, servicing the life, liability, and property insurance needs of the Japanese agricultural industry. In Canada, it was predated by six years by the Co-operators insurance company.

Zenkyoren, the Co-operators insurance company, and most other co-operative insurers are secondary co-ops that are not owned directly by individual members but by a consortium of credit unions, co-ops, and other organizations.

The co-operative movement has extended to all corners of the world, with co-ops and credit unions working to create national co-operative insurance companies in Malawi and other countries.

The International Co-operative and Mutual Insurance Federation (ICMIF) reports that since the global financial crisis that began in 2007, the insurance industry market share held by mutual and co-op insurers has increased from 23.7 to almost 27 percent.

Shaun Tarbuck, CEO of ICMIF, noted that mutual insurers and co-ops are more actively marketing their unique attributes including a different structure of governance, member-ownership, business sustainability, and profit-sharing.

This is a drastic change from what occurred in Britain during demutualization, when major insurers converted from member-owned establishments into plcs.

Demutualization caused Britain to have the smallest mutual and co-op insurance market share of all major economies.

Royal London is the largest pensions and life mutual in the nation so the life business of the Co-operative Group will be in good hands. There is still potential for cancellation of the general insurance sale.

However, if this goes through, the company will still sell its rebranded insurance products under the name of Co-operative Insurance with underwriting provided by another organization.

UK residents are raiding their piggy banks to maintain their standards of living, dropping family savings to their lowest levels in four years. The economy may seem to be improving but consumers are paying the price, supporting it with their savings rather than with newly-generated income.

Though the indication of economic growth is positive news, the running down of savings is not. Many UK adults will find themselves without enough money to provide for future generations in the event of their deaths.

Significant Decline In Peoples Savings

The Trades Union Congress (TUC), the national trade union centre, recently reported that household savings dropped from £20.1 to £11.4 billion. The same period was characterised by a 4.2 percent increase in consumer spending and government support of the housing market.

This is not a sustainable framework for economic recovery and is uncomfortably similar to the trends that caused the economy to crash several years ago.

According to Frances O’Grady, general secretary of TUC, sustainable recovery is based on investment, growth, and recovery of living standards. He called for a “pay rise” for Britain. A spokesperson for the Treasury commented that though the UK is recovering, it has far to go and the situation is still difficult for many families.

The spokesperson stated that the government is committed to delivering sustainable growth and jobs while correcting what caused the economy to go awry.

Providing for the Future

With more UK families breaking into their piggy banks and depleting savings, the future looks grim for their beneficiaries. Future generations may be unable to rely upon this money to maintain their standards of living once these savers are deceased. In extreme situations, beneficiaries may be forced to sell cars, homes, and other valuable assets to make ends meet or repay debts left by the deceased.

Life insurance is one way to prevent this unnecessary burden on younger generations. UK adults can allocate some of their income to life insurance premiums, purchasing policies that provide lump sum pay-outs upon their death. If there is no income to spare, using some savings to buy life cover is a smart investment in the future. Beneficiaries will receive money when they most need it and can use this for any purpose.

Tax Break Benefits

Pay-outs from life policies are not subject to income or capital gains tax, increasing the amount that beneficiaries receive. If a policy is written in trust, it is not considered part of an estate and is then exempt from inheritance tax. Consumers should consult with a life insurance expert to structure their life policies appropriately for limited tax implications.

When shopping for life cover, comparing the benefits, terms, and conditions of several policies is recommended. By taking this approach, consumers will find the most desirable cover at the most affordable price. A life insurance comparison website offers one-stop shopping for cover across multiple carriers.

Wherever they end up purchasing cover, consumers should ensure that the pay-out meets the financial needs of beneficiaries. An investment in life insurance is only worthwhile if it allows recipients to life comfortably without dipping into their own savings to carry on.

We read a lot about insuring our own lives or the lives of our spouses. What about the lives of our children? These youngsters are so precious to us and unfortunately, many of them pass away each year. Should we insure their lives to help pay for their funeral and burial expenses or is this a waste of money? Unfortunately, many families have realised that it would be money well-spent.

Alarming Child Mortality Statistics

According to a recent article in The Guardian, death rates for British children are “a major crisis.” Every day, five children in Britain die unnecessarily from pneumonia, meningitis, asthma, and other conditions that are not property treated because NHS care for youngsters is inadequate and poorly organized, says the Royal College of Paediatrics and Child Health, a leader of 11,000 UK child health specialists.

Two thousand young lives are lost each year, causing the UK to have some of the worst death rates for children to age 14 within Europe

Experts say that sick children in the UK have greater risk of dying due to lack of paediatric skills possessed by some general practitioners, lack of expertise in small paediatric units, and a shortage of consultants. According to the Royal College, the lack of senior-level paediatricians is so severe that every unit cannot guarantee safety of treatment.

The college is fighting for major changes in the NHS treatment of children, calling for centralised hospital services to reduce the number of preventable deaths. Sweden is being promoted as one model of effective healthcare for children.

The 2012 mortality database of the World Health Organisation (WHO) reflected that, of 14 nations, the UK had the highest proportion by far of “yearly excess child deaths compared with Sweden.” Nearly 2,000 of the 6,198 deaths occurred in this region, more than two times the number of deaths in France and more than all other included countries of a similar size.

Hilary Cass, a consultant paediatrician at Evelina hospital for children in London, noted that children are the future and said, “we should do so much better.”

Calling for Improved Child Healthcare

Tough some of these children experience several congenital abnormalities from birth, a large portion are considered “healthcare amenable.” This means that better treatment would have prevented the children from dying. Among zero to 14-year-olds in eight European nations, the UK had the worst mortality rate due to asthma and the fourth worst of 15 countries for death from pneumonia, according to the WHO. Only three percent of asthmatic children have personal care plans.

By failing to change the organisation and delivery of healthcare services for children, the UK has achieved the worst child mortality in Europe. Until this situation is addressed, parents should consider insuring the lives of their children. Losing a child is very difficult and struggling to pay for a decent funeral and burial makes things much worse.

In the meantime, politicians and healthcare advocates are calling on all relevant organisations to work together to improve the health of UK children by delivering more and better care. Each child deserves an equal chance of living a healthy life.