Can you insure your parents?
If you’ve ever wondered whether you can insure your parents, the simple answer is no – you can’t for a variety of reasons. One such reason is that our application process requires that the person being insured completes the application themselves.
However, we understand that when you begin to consider taking out life insurance to help provide for your own family if you pass away, you may also start to wonder about the provisions made by your own parents. For example, you may have concerns about the cost of a funeral or any outstanding debts. So, let us help set your mind at rest.
Helping your parents prepare for the future
At some point, you might find that your parent or parents want to discuss their future plans with you, including what will happen regarding their finances after they pass away. It’s only natural that you’ll want to take an active interest in their financial status at this stage, and while you can’t simply buy life insurance for parents over 50 or 60 yourself, you can point them in the direction of various life cover policies so that they can ultimately decide. Once you’re ready to discuss these matters with your parents, there are a number of key areas you could consider together, including:
- Do they have any form of life insurance?
- Have they paid off their mortgage?
- Are there any outstanding debts or loans?
- What assets, including property and savings, do they have?
- Is one parent financially dependent on the other?
You might not be able to directly insure your parents on their behalf, but the advantage to having these kinds of conversations is they can make sure everyone knows where things stand, highlight any gaps in planning and provide reassurance for the whole family.
Are there any exceptional circumstances?
The one exception when you have the opportunity to insure your parents' lives you must have an ‘insurable interest’ in them. This requirement was introduced by the Life Assurance Act 1774.
Examples of insurable interest
- Your parents owed you money that would be lost if they predeceased you.
- Repayment of a mortgage or debt you’re jointly or solely responsible for.
You would need your parents’ permission before taking out any life insurance for them.