Life insurance: the gift of financial stability for the family left behind

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The festive season is a time to reflect as well as enjoy family time and give presents.

Some gifts are free – your love, time, attention – but taking care of your family financially, knowing that whatever happens they will manage financially, is an invisible gift with significant value.

In the event of serious illness or death, especially of a main earner, the biggest worry that a widow(er) will have is how they will pay the bills. The kindest thing to do is to take away that concern.

Losing a parent, spouse or any loved one is hard. Being left in financial difficulty makes it even harder.

Life insurance and wills don’t come wrapped with ribbons, but they are so important when you have dependents.

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Multiple studies have shown that widows can lose at least half of the household income if their husband dies, often more. That is a huge figure and can make it hard to manage financially, especially if there are dependent children.

In the UAE, I come across far too many families where one parent is the main earner, where they have young children, but there is no life cover at all.

If the breadwinner is no longer around to bring home an income, the family may have to move, the sole parent may have to work longer hours to bring in an income, the children may need to change to cheaper schools.

They may all have to relocate to a home country and rely on family for support, an upheaval at a time when continuity is often more beneficial for grieving.

The point of life cover is not just about the money but about what it means to the family left behind.

It means rent can be paid, mortgage can be paid off, children can continue their education, families can have financial security. 

Taking away financial worries and securing futures is truly a gift. No one knows what’s around the corner, and the harsh reality is that some people will die early.

Simple life insurance buys peace of mind and may be cheaper than you think. You don’t need to spend a great deal of money each month to ensure your children will have a roof over their heads and a good education.

There are other considerations when you have dependents such as wills and having some cash to fall back on, an emergency fund in a safe place, but you still need life cover.

Don’t rely on anything your employer provides. That should be seen as a bonus but not relied on exclusively as it is outside of your control.

No one thinks twice about insuring their cars, but you are so much more valuable. Your family is the most important thing in your life, so take the steps to ensure that no matter what happens, you give them the gift of financial stability. 

Keren Bobker is a Dubai-based independent financial adviser and senior partner at Holborn Assets