Life assurance, more commonly known as Life Insurance, is an assurance we take out to provide financial support for others, in the event of your death.
Assurance is essentially the same as insurance, however we use the term assurance when something is definitely going to happen, whereas insurance is the term used when something might happen. For example; Buildings Insurance is there just in case your house becomes damaged, it’s not a certainty that it will become damaged – indeed we hope it won’t be – however it is there ‘just in case’.
Life Assurance on the other hand, assures a sum of money in the event of your death, subject to the terms of your policy. Whilst none of us enjoy thinking about it, by having a Life Assurance policy in place we are preparing for one of life’s few certainties.
Our advisers have many years’ experience in arranging life assurance policies for clients and are able to sensitively advise what could be the best cover for you.
When it comes to Life Assurance, it does become more expensive the older you get, so taking a proactive stance is always the best option.
There are three main types of Life Assurance policies; Level Term Life Assurance, Decreasing Term Life Assurance and Family Income Benefit.
These are explained in their own articles, as there are advantages and disadvantages to all. Your adviser will be happy to discuss the different types of Life Assurance with you as part of your mortgage process, ensuring that you have the right amount of cover for your needs.
Many people choose Decreasing Term as this type of assurance decreases as the amount of money owed on a repayment mortgage decreases. This type of assurance is less expensive, compared to Level Term Assurance, as the premium (what you pay) takes into account the reducing amount of cover over the duration of the plan.
This option allows you to feel safe in the knowledge that you know the exact amount that would be paid out upon death, regardless of your mortgage balance. Level Term Cover essentially does what it says on the tin. You choose an amount of cover that you believe will be sufficient to satisfy your needs and for how long you need the cover.
There is also the option to have the level of cover stay inline with inflation, by having it index linked, to add additional peace of mind.
A final type of Life Assurance that we can arrange here at White Mortgages, is Family Income Benefit. This is a protection policy which is designed to pay out a regular monthly income, rather than a one off lump sum, in the event of your death. Designed to potentially replace lost income over a set term following the death of the insured person. This type of cover is popular with parents who wish to protect their family against the financial implications of their death, as it can be more cost effective than taking out a simple Level Term Assurance policy.
Knowing which type of Life Assurance will be the best for you & your family can be a challenge, this is where working with our advisers is helpful. They are able to talk you through the different types and levels of cover available, explaining which may be the best option for you and why.
Once you’ve chosen the most appropriate type of cover for you, your adviser will approach a number of different providers to see who can provide the best protection for your needs & budget. They will always refer back to you before putting anything in place & are happy to discuss any aspect of the policy that they have suggested to you.
Providers will require a health & lifestyle questionnaire to be completed in order to assess and agree your cover. Our team can help complete these with you, or arrange for you to access these questionnaires yourself if you’d prefer some privacy, although any issues that you feel could affect the cover should be discussed with your adviser. We’ll keep in contact with you and your provider if the need for updates should arise. From ensuring that your address is updated when you move, to checking that you have received all of your documents, we will be your port of call.