Life Insurance

Life insurance is a policy designed to provide your loved ones with financial security should you, or your partner or spouse die during the policy term.

• Monthly premiums are guaranteed never to rise
• Premiums start from £5 a month, depending on your personal circumstances
• Joint cover available for you and your partner
• Easy to arrange — no complicated forms to fill in

To find out more and to speak to our experienced advisers please call 01202 802677

Life insurance can often be one of the last things we think about but making sure that your loved ones are provided for if the worst happens to you is something we should all consider.

What is Life Insurance?

Life insurance is a policy designed to provide your loved ones with financial security should you, or your partner or spouse die (if the policy is in joint names) during the term. Life insurance is typically purchased by those of us who have a mortgage or other loans or are financially responsible for others. It is important to note that life insurance products have no cash value, either during the term or at maturity and if you cease paying the premiums the cover will stop.

Having sufficient life insurance cover offers peace of mind knowing that your family will be looked after in the event of your death.

Why is Life Insurance so Important?

There are many reasons why this type of protection is important. For example, life insurance is typically taken out when a mortgage is agreed, so that in the event of your (or your partner or spouse’s death, if applicable) untimely death, the outstanding mortgage can be re-paid meaning at least your family won’t need to worry about mortgage payments and keeping a roof over their head at such a distressing time.

There can be many other reasons why people may need to take out a life insurance policy, whether it is to pay for your family home or to leave those closest to you money for their futures.

Different Types of Cover

There are different life insurance policies available and it is important to understand how the types differ when choosing the right policy for you. The most typical examples of life cover available are;

Level Term Insurance -This policy is designed to pay out a fixed lump sum that remains constant, or level during the ‘term’ or period of the insurance. If you have an Interest only mortgage, where the amount owed does not decrease, it is often this type of policy that is appropriate.

Decreasing Term Insurance – Often used in conjunction with a repayment mortgage, this policy is designed to pay out in the event of death during the term of your mortgage. The amount of cover will decrease in line with the amount owed on your mortgage, if you do have a repayment mortgage.

Critical Illness Cover - Critical illness insurance is designed to ease the financial pressures by paying a tax-free lump sum if you are diagnosed with a serious illness that is covered by the policy. The lump sum can give you the means to repay some or all of your mortgage if you are unable to work or help pay for home alterations, specialist equipment or provide an income. This cover can be taken on a level or decreasing basis, or as a ‘standalone’ policy.

Each insurer and every policy is different and there can be exclusions and limitations, so it is very important to read and understand the terms and conditions of your chosen policy to double check the conditions you are covered against on the critical illness policy.

Comparing Life Insurance

Before purchasing your life insurance it is important to consider how much cover you will need. The more cover you need the greater the monthly premiums will generally be. Level term is slightly more expensive than decreasing and the premiums are affected by several different factors.

Typically these are

• Your age – In most cases, the younger you are when you start the policy, the cheaper the premiums will be.

• Your health – If you have previously had a serious illness or medical condition, it is likely that your premiums will be increased.

• Smoking any types of tobacco products will increase the premium. These can reduce after you have stopped smoking for at least 12 months.

• The amount of cover – The greater the amount of cover required, the more the premiums will be.

Important things to remember: As for any life insurance this type of policy will be underwritten which means that you may not be eligible if you already have serious health problems. This may also affect the level of premium. There may also be exclusions if you do activities such as risky sports. You should look at the product details for each provider.

As with all insurance policies, conditions and exclusions will apply.