Life insurance is a contract between an individual and an insurer or assurer, where the insurer promises to pay a designated beneficiary a sum of money in exchange for a premium, upon the death of an insured person.
It’s designed to help those left behind carry on living and can be used to; repay a mortgage, cover ongoing household expenditure, or simply just to take time away from work to grieve, providing a little peace of mind at a distressing time and preventing future financial hardship.
Policies can be arranged for individuals on a ‘single life’ or for couples on a ‘joint life’ basis, though on joint life there would only be one pay out on the first event, hence why couples with children often opt for two single life policies or dual plans.
There is no cash in value at any time and cover will end when the premium payment stops. Cover can be on decreasing, level or an increasing term basis.
Different types of Life Insurance
Level Term Assurance
Level term life insurance covers you for a set sum that remains the same during the policy term. Both the sum insured, and the premiums can be guaranteed following full underwriting for the term or reviewable dependant on what best suits your circumstances. If guaranteed the price you pay won’t increase with inflation, but then neither will the sum insured. It’s often used to cover the balance of an interest only mortgage or for additional family protection requirements, though can be used for any purpose.
Increasing Term Assurance
Increasing Term Assurance is often referred to as Increasing or Index-Linked Life Insurance as the sum insured increases each year in-line with the retail Price Index (RPI) or a pre-agreed increment.
If you don’t pass away during the term on a decreasing, level or increasing term policy then the policy will simply lapse, and you would need to take out a new policy if you required further life insurance.
We are also able to write your policy in Trust ensuring that you’re in control of who receives the benefit when you die. Additionally, pay-outs for policies under a Trust are probate-free so are made quicker and fall outside of your estate for tax purposes.
Our Expert Advisors
At Jordan Lynch we are able to advise on and arrange life insurance policies with all the UK’s leading insurers. Our expert advisors have in depth knowledge of insurers underwriting policies and can arrange policies for individuals who’ve already suffered severe health issues and have perhaps been turned down for cover elsewhere.