UK Life Insurance Guide
Here is a useful guide to life insurance. Simply put, a life insurance policy provides a lump sum
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- What is Income Protection Insurance?
- There are two variations of Income Protection Insurance: - Short Term Income Protection and PHI or Permanent Health Insurance.
- What is Terminal Illness Insurance?
- Terminal Illness Insurance pays out if you are diagnosed with an illness from which you are expected to die within 12 months of diagnosis.
- Are there any fees or extra costs to pay?
- If you are purchasing life insurance through our product partner, Life Policies Direct, then there will are no fees or other costs to pay
- How is a claim made under a life insurance policy?
- All claims are made against the Life Company who issued your policy. You will find details of the claims procedure within the policy documents they provide with your policy and in the key features document.
In exchange for regular premiums, a life insurance company will insure your life so that when you die, the policy should pay out to protect your dependants from the extra pain of financial hardship.
This is particularly important when buying a house, or when you or your family takes on a large, long-term financial commitment. In the event of death, for example, the payment from a life insurance policy can be used to pay off a mortgage.
Policies can be arranged on either a single or joint life basis. Depending on the type of policy you choose, your insurer will pay either a lump sum or a regular income which you could use towards meeting any outstanding debts and trying to ensure your family is able to maintain its standard of living.
How much they receive depends upon the 'guaranteed sum assured', the ( loans ) amount for which your life is insured.
Many people first come across life insurance when they take out a mortgage, as lenders often insist on it to make sure the loan is repaid if you should die still owing them money.
However in some circumstances, only having enough life insurance to repay the mortgage is insufficient to fully protect dependants. If you have a partner who ( cheap life insurance ) would suffer financially if you were to die or if you have young children who depend on you, then life insurance is very important.