Life and Critical Illness Cover
Provide a lump sum for your family
What is life insurance?
Life insurance, which can also be known as life cover or life assurance, is a type of policy that protects your loved ones with financial cover if you die. It can help minimise the financial impact that your death could have on your family, and offer peace of mind to those you care about most.
Most life insurance policies are designed to pay out a cash sum to your loved ones if you die while covered by the policy. It can help them deal with everyday money worries such as household bills, childcare costs or mortgage payments.
The average UK mortgage debt is £130,000 with a 20 year term in 2019.
What types of life insurance are available in the market?
The two main types of life insurance are term life insurance and whole of life insurance. When you take out term life insurance, there is usually a maximum term you can apply for, and could pay out a cash sum if you die during that period of cover. This is the type of life insurance that we can offer without advice and you can choose between Life Insurance or Decreasing Life Insurance.
How does life insurance work?
Both types of life insurance could pay out a cash sum if you die or are diagnosed with a terminal illness while covered by the policy (provided your life expectancy is less than 12 months).
You choose the amount of cover you need and how long you need it for. You can take out life insurance under joint or single names and you can pay your premiums monthly or annually.
What does life insurance cover?
Decreasing Life Insurance is often used to help protect a repayment mortgage because the amount of cover reduces roughly in line with the way a repayment mortgage decreases.
Whereas Life Insurance is usually chosen to help financially protect loved ones. The cash sum could be used by your family to help cover everyday living expenses such as household bills, rent or childcare or it could be used to help pay off a mortgage.
Is life insurance only for people who have children?
Raising a child is one of the obvious reasons people start to think about life insurance. After all, what is life insurance for if not to protect families? But it’s not the only reason you should think about getting cover. If you live with your partner and they would struggle to pay the mortgage if you were to die, then you should consider life insurance.
A Life Insurance policy could be suitable if you have an interest only mortgage, as the cash sum that could be paid out could help to pay off the mortgage. Or it could also be used to help your family with everyday living expenses.
Please remember that life insurance is not a savings or investment product and has no cash value unless a valid claim is made.
The estimated lifetime cost of raising a child is £186,000 and rising according to research by insurers
What about Critical Illness cover?
Critical Illness Cover can help minimise the financial impact on you and your family if you become critically ill. It’s an option that can be added for an extra cost when you take out Life Insurance or Decreasing Life Insurance.
Critical Illness Cover can be added to Life Insurance or Decreasing Life Insurance for an extra cost. It could pay out a cash sum if you’re diagnosed with, or undergo a medical procedure for one of the specified critical illness that we cover during the length of your policy, and you survive for 14 days from diagnosis.