Life Insurance
Term Insurance
This is the simplest and cheapest type of life insurance, and is known as term 
insurance because you choose how long you wish the cover to last, for example 20 years. (the term). A term policy is designed to protect your family, should the worst happen, by ensuring you leave them with sufficient capital to maintain their lifestyle & repay any debts or mortgage. At such a difficult time knowing you have provided financial security will help your family to face the future.
Level Term
Level term insurance or family protection pays out a guaranteed cash sum if you die during the term of the policy. Most policies also pay out if you are diagnosed as suffering from a terminal illness and are expected to survive less than 12 months. You can take out a policy on your own or as a joint policy with your partner. For joint life policies the cash sum is payable only once on the first death.
Decreasing Term
Decreasing term also known mortgage protection pays out a cash sum if you die during the term of the policy and is designed to be used alongside a repayment mortgage. The cash sum assured decreases broadly in line with your mortgage to pay off the outstanding balance and is therefore cheaper than level term. If you have an interest only mortgage you may decide that a level term insurance policy is better suited to your needs. Decreasing term is available on a single or joint life basis.
Increasing Term
Is a term policy with an indexation option that allows you to increase your benefits annually in line with inflation or by a fixed percentage with a corresponding increase to the premium.
Family Income Benefit
As with other types of life insurance, a Family Income Benefit protection policy is designed to maintain a family’s income at an acceptable level if the main income provider dies.
It will provide your dependents with a monthly income, rather than a lump sum in the event of your death. The agreed amount is paid from the time of the claim through to the end of the term chosen at the outset of the policy.
Family Income Benefit does not involve any investment, and there is no surrender value. It’s often cheaper than other types of life insurance policy.
How much will it cost?
The cost of a term policy depends on a number of factors, including:
- The term of the policy
- Level of cover you require
- Your age and lifestyle
Having life assurance needn’t be expensive though – in fact, premiums start from just a few pounds a month.
How much cover will I need?
The level of cover you choose is up to you. Generally, people want to ensure that their debts and mortgage are cleared, and then work out what they would like to leave their family. As a rule of thumb, some people use the measure of 4 years salary.
Why not get a quote to see how little your ideal cash sum assured will cost. You can always tailor the sum assured or premium to suit your budget once you have the facts.
What options should I consider?
- Level or decreasing term insurance
- Guaranteed or reviewable premiums
- Waiver of Premium
- Terminal illness
- Writing the policy under trust
- Making a will
- Indexation
Did you know?
- Diseases of the heart and circulatory system (cardiovascular disease or CVD) were the main cause of death in the UK in 2004.
(source: www.heartstats.org May 2007).
- Stroke is the third most common cause of death in the UK. It is also the single most common cause of severe disability and more than 250,000 people live with disabilities caused by stroke.
(Source: www.stroke.org.uk May 2007).
- An Aviva survey revealed that 50% of the adult population have no life cover.