Unfortunately, the disparity between the sexes is rather apparent in the life insurance industry. Statistics surrounding life insurance demonstrate that more men take out coverage than women. This seems to be the case regardless of whether they are in a full-time career, are a full-time homemaker, or anything in between. With more women than ever working their way up the ranks, life insurance for women needs to be in the conversation.
Women in business face many challenges, and that is even more so as a business leader. Women have been redefining roles in both the workplace and in the home, yet life insurance is often overlooked. Whichever role you’ve decided to take, life insurance needs to be an essential part of your estate to protect what happens to your finances as well as your loved ones.
Single Women
If you live by yourself with no dependants, then you may not need life insurance. Despite this, women with mortgages, debts, or other estate expenses may need to look into getting life insurance to protect their family. If you have elderly parents who may not be able to afford funeral expenses or help sort out their mortgage, then life insurance can help to protect them. Chances are, you may only need a small amount of insurance if any at all. If you’re working, then your business may offer it as part of a benefits package.
The Dual Income Household
If you have a partner and/or child, then life insurance should definitely be on the table. Most modern families rely on dual incomes to cover mortgages, bills, and their current lifestyles. Couples don’t just make two incomes; sharing the responsibilities within the household needs to be protected, too. If that income were to be taken away from your family, how would they be able to survive?
A life insurance policy separate to that of your partner can help families maintain their current lifestyles as well as help to pay off mortgages and any other debts. Any money spent on taking time off, childcare, education, and homemaking can be compensated by making the financial situation easier to bear.
Women Business Owners and Directors
For women in business, if you own your own firm or are a director of a company, you can actually obtain life insurance through your business to save money. Key man insurance, or key employee insurance, is a life insurance policy designed to protect the business against the financial implications of losing a member of staff.
The main advantage of key employee insurance is the tax implications. For employed directors, the key employee insurance can be put through as a business expense. For major shareholders, this isn’t feasible, but instead, the payout is generally tax-free, so your beneficiaries can receive more of the payout.
Key man insurance can be used to protect both your family and the business. If you’ve created an entity from scratch, life insurance can be used to protect its legacy. If you’ve worked hard to achieve what you have within a business, the life insurance can be used to help keep that business afloat.
Financial Planning for Working Women
Economically, women are likely to live longer while earning, on average, less than men. Therefore, planning for this financially can be a difficult but important task.
Life insurance for women should be part of a good financial plan. The good news is, some insurance, like key employee insurance, can actually be placed in a trust so that you can have more control over what happens to your wealth. Furthermore, placing a life insurance policy in a trust can mean that it doesn’t fall into your lifetime pension allowance. Life insurance can also be used to counteract any inheritance tax paid on the estate and can be a great addition to an effective estate plan.
Women in business, or even stay-at-home parents need to start investing in life insurance. Senior executives, directors, and business owners, as well as homemakers, can gain control over what happens to their wealth. It’s time we lessen the gap between life insurance for women compared to men. As we take on more responsibility financially, it makes fiscal sense to protect it, too.
About the Author
Sarah Beldon is a digital marketing executive for Business Cover Expert, which offers a wide range business life insurance products from the UK’s top providers.
