Taking out a Life Insurance policy probably isn't the most exciting thing you will ever do but may prove invaluable to your family in the event of your death. This means your family can focus on themselves instead of worrying about their finances.
Unfortunately it’s a fact of life that we won’t always be around and like most people, you’ve probably thought about how your family will cope emotionally if you’re not there - but have you thought how they will cope financially?
Life Insurance is about providing financial security for people who depend on you financially. There are a number of different types of Life Insurance, depending on your circumstances.
This is the most basic and cheapest type of Life Insurance, and is known as term insurance because you choose how long you're covered for, say, 10, 15, or 20 years .
It only pays out if you die within the term you've agreed. If you live longer than the term, you get nothing. The policy can be written on a single or joint basis, with the policy paying out on the first death only during the term.
There are different types of policy you can have:
• Family Income Benefit, a policy which pays out income rather than a lump sum
• Increasing Life Insurance, where cover and premiums rise over the years
• Decreasing Life Insurance, where cover decreases over the years)
• Renewable Life Insurance, which lets you extend the original term
Decreasing term insurance is often linked to a repayment mortgage. Here the amount you owe decreases over time and may, in this instance, be called mortgage term insurance or mortgage protection life insurance.
The premiums you pay are usually fixed for the whole term. There are also contracts where premiums are reviewable after a certain period, usually five years.
Did you know?
You often get Free Cover from the Insurance Company if the cover is to protect a mortgage. This covers you between exchange of contracts (or completion of underwriting if this is later) & completion of your mortgage or the start of the Plan (usually capped at 90 days)
Life Cover For All LLP (Registered in England under company Reg No OC359631) is an Appointed Representative of
Access Wealth Management, The Beacon, Beaufront Park, Anick Road, Hexham, Northumberland, NE46 4TU
which is authorised and regulated by the Financial Conduct Authority