Death in service policy advice.

L

Lamps

Registered User
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I'm civil servant since 2006, married and with a kid on the way I think it would be prudent to take out a life insurance policy.

I'm trying to calculate how much cover I need and am trying to figure out the 'death in service' benefit. Am I right to say that if I died, my wife would receive the lump sum I would be entitled to if I retired due to ill health at the time of death. So with 16 years service she would be entitled to 48/80th of my current salary?

Is there anything else I need to consider here before taking out a life insurance policy?
 
Death-in-service is usually a multiple of your salary, (might be ×3 or x4) paid as a lump sum.

You should complete the nomination form to let the trustees know your wishes.
 
Death in service in the public service is the tax free lump sum you would have received at time of death subject to a minimum of one times salary. She will also receive 50% of the pension had you worked to normal pension age. She will also receive the Widow's pension.

Remember that life cover is pretty cheap and premature death is very traumatic for your family. It is better to be over generous rather than skimping it to as low as you can get it. While the chances are the policy will never be used, if it is, it will be put to good use and having a decent lump sum will give the surviving spouse choices.

I have had spouse's come into me asking what to do with the €60,000 cover they got to cover her and the kids. Very little has always been the answer.


Steven
www.bluewaterfp.ie
 
Lamps said:
Is there anything else I need to consider here before taking out a life insurance policy?
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How much life insurance you need depends on a lot of things like age, income, and wealth.

For example if your spouse is on bulletproof employment of €100k and you own a house without a mortgage then life insurance might not be necessary.

For someone of your age a serious illness preventing you from working is far more likely than death. I think it's prudent to insure against that.
 
NoRegretsCoyote said:
How much life insurance you need depends on a lot of things like age, income, and wealth.

For example if your spouse is on bulletproof employment of €100k and you own a house without a mortgage then life insurance might not be necessary.
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Not disagreeing with you, but as @Lamps mentioned they have a child on the way, life assurance is most certainly essential here.
 
T McGibney said:
life assurance is most certainly essential here.
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Agree. It's only a question of how much.

On various threads on AAM over the years I've seen people hugely over- and under-insured. People tend to lack a frame of reference for how much they need as age, income, wealth, and health are always evolving. I struggle with it myself even.
 
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