A Guide to Life Insurance for Single Mothers

Introduction: Navigating Parenthood as a Single Mother

Life as a single mother comes with its unique challenges and responsibilities.

In this article, we’ll explore how you can protect yourself and your children through essential insurance policies.

If you’re new to life insurance, you probably have a lot of questions.

Let’s address some of them.

What Types of Life Insurance Does a Single Mother Need?

The major risks you face as a single mother are:

loss of your current income if you’re unable to work due to illness.
loss of future financial stability for your children if you depart this world unexpectedly

As luck would have it, there are specific insurance policies to mitigate these risks.

Let’s start with the most important: income protection

Securing Your Income – Income Protection for Single Mothers

Assessing Your Sick Pay Entitlement

The first thing you should do (after finishing this blog) is contact your employer and check out your sick pay entitlements.

It’s worth checking with HR how long your employer will pay you.

In my experience, a very generous employer will offer sick pay for 13-26 weeks.

What happens then?

You will have to live off state benefits (currently €220 per week)

For most single parents, that’s a huge drop in their weekly income.

Would you struggle to pay your mortgage let alone all the other bills that would continue to pile up like

Groceries
Heating
Electricity
Broadband
Phone
Bins
TV Licence
Holiday

Understanding Income Protection

Your income is your biggest asset and that’s why income protection is the most important insurance you can buy.

It will pay you up to 75% of your income if you can’t work for over 4 weeks due to any illness or disability.

It will pay you until you get back to work or until you retire.

So you can continue to provide for your children as you do today.

Without an income your dreams for them will fade, but with income protection those dreams will come true.

Providing for Tomorrow – Life Insurance

Types of Life Insurance | Whole of Life V’s Term Life

The choice between guaranteed whole-of-life insurance and term life insurance for a single mother depends on your specific financial goals and circumstances.

Both types of insurance have their advantages and disadvantages, so it’s essential to consider your needs when making a decision:

Term Life Insurance:

Temporary Coverage: Term life insurance provides coverage for a specific term, such as 10, 20, or 30 years.  It’s designed to provide financial protection during a specific period when your children are most vulnerable, such as when they are young and financially reliant on you.
Affordability: Term life insurance premiums are generally more affordable than whole life insurance premiums for the same coverage amount. This can be advantageous for single mothers on a budget.
Flexibility: Term policies are flexible, allowing you to choose the coverage amount and term that suits your needs. Most single mothers buy cover until their youngest is 25 and financially independent.
Convertible: You can extend your policy in the future without having to answer health questions.

Guaranteed Whole of Life Insurance:

Lifetime Coverage: Guaranteed whole-of-life insurance provides coverage for your entire lifetime, as long as you continue to pay premiums. This means your children will receive a payout whenever you pass away, regardless of when that occurs.
Stable Premiums: Premiums for whole life insurance policies are fixed and do not increase over time. It may seem expensive now but in 20 years, inflation will make your premiums seem downright cheap!
Estate Planning: Whole life insurance can be useful for inheritance tax planning. If set up correctly, the proceeds will be paid out tax-free.

So, which one should you choose?

Whole-of-life cover is the best option as it guarantees a payout but the premiums are 10-15 times higher than term life insurance.

That may make your decision easier!

Ultimately, the choice between term life insurance and guaranteed whole-of-life insurance should be based on your unique financial objectives and the level of protection you want to provide for your children.

Determining the Right Amount of Life Insurance

The rule of thumb is 10-15 times your income but this can vary from one parent to the next depending on:

age
do you have life cover through work
mortgage protection
savings/investments

If you’d like me to make a personalised recommendation for you, complete this short questionnaire.

What’s the average cost of life insurance for a single parent?

That’s a tricky one to answer as it also depends on some of the factors mentioned above.

But you can head over here to get an instant quote from our panel of insurers (Aviva, Irish Life, New Ireland, Royal London and Zurich).

I bet life insurance costs a lot less than you think.

Before I give you the answer, take a guess!

€100?

€75?

€50?

You can buy a half-a-million cover that insures you until you reach 60 for just €34 per month

I told you it costs less than you think.

That’s around €1 per day to ensure your children are financially secure should you leave us before your time.

How can I make sure my life insurance payout goes to my children?

You can write your policy in trust for your children or make a will.

Is it difficult to buy life insurance as a single mother?

Not at all, it’s simple and you can do it all online, over email or on the phone, whichever suits you.

If you’re in good health, you could have a policy on the same day.

What if I have health issues?

You’re in the right place!

We specialise in getting cover for people with health conditions.

How long should my policy last?

We recommend buying a policy that runs until your youngest is 25 and financially independent (yeah right!).

This protects them while they’re small while a shorter term makes your cover more affordable.

Which insurer is best for mother’s life insurance?

Aviva, to be fair, has the best overall benefits including AvivaCare

But the bottom line is you can trust all 5 of these life insurance providers.

If you buy from any of them, you have nothing to worry about.

But if want some guidance, please feel free to get in touch, and we can chat through the differences.

3. Extra Protection | Critical Illness Cover

Serious illness cover pays you a tax-free lump sum should you contract one of the illnesses named on your policy.

Cancer, heart attack and strokes account for 90% of all claims.

You could use the lump sum provided to:

Make any necessary alterations to your home,
Pay for medical treatment and expenses (Irish Cancer Society says cancer can cost up to €2600 per month)
Help with your mortgage or other loans or bills.
Blow it on a holiday if you feel like it!

We recommend buying enough to cover emergency expenses, say one year’s net income.

Over to you…

Life insurance is a vital safeguard for single mothers and their children.

Remember, bad things can happen to good people, but with the right insurance, you can prepare for the worst while hoping for the best.

If you have any questions or need guidance on choosing the right insurance policy, don’t hesitate to contact us.

We’re here to help you and to make arranging life insurance easy

Take the first step towards securing your family’s future – complete this questionnaire and we’ll be back over email with a personalised, no-obligation recommendation.

Thanks for reading

Nick 

lion.ie | Protection Broker of the Year 🏆

Editor’s Note: We first published this blog in 2018 and have regularly updated it.