Life Insurance FAQ

What is a Term Assurance plan?
It's a Life Insurance plan that pays out a guaranteed cash sum if you die during the term of the plan or are diagnosed as suffering from a terminal illness.

What is a Mortgage Protection Plan?
A mortgage life insurance plan is used to help pay off the outstanding balance of your mortgage with a cash sum if you should die before your mortgage is repaid. Over time, the level of life insurance provided by the plan falls to reflect your reducing mortgage loan, so you are paying only for the cover you need.

What is the difference between life assurance and life insurance?
Generally life assurance is regarded as cover for the entire life of an individual, paying out ultimately upon death, whereas life insurance is life cover for a specific fixed term i.e. life insurance to cover the period of a mortgage.

When does the life cover pay out?
The life insurance policy will pay out a cash sum if you: Die during the plan term or are diagnosed, as suffering from a terminal illness and you aren't likely to live more than 12 months. This only applies before the last 18 months of the plan term.

What other benefits can I choose in addition to the life insurance?

Critical Illness Cover -
Critical Illness Cover option pays out a cash lump sum if you are diagnosed with a specific critical illness - provided you survive for 28 days after being diagnosed. The lump sum could pay for things like nursing care, home-help, adapting your house to accommodate a disability; it could pay off your mortgage or give you a holiday to recover from treatment.

Premium Payment Protection Cover -
Premium payment protection. If you choose this option the premiums can be waived during a period of incapacity exceeding the deferred period. Incapacity means that you are unable to continue working or fail certain Activities of Daily Living through illness or disability.

Do I get any money back if I don't die or fall seriously ill before the end of my plan?

No. The plan provides pure insurance only and there is no cash-in value at any time. It has no savings content.

Will any life insurance payment be taxed?
Under current rules no tax will be deducted from any payment made as a result of claims from serious illness cover. Depending on individual circumstances, some life insurance claims may be subject to inheritance tax.

What is the difference between whole life assurance and life term insurance?
Generally whole life assurance is regarded as cover for the entire life of an individual, paying out ultimately upon death; whereas life term insurance is life cover for a specific fixed term i.e. life insurance to cover the period of a mortgage.

Do I get any money back if I don't die before the end of my plan?
No. The plan provides pure insurance only and there is no cash-in value at any time. It has no savings content.

Can the life assurance plan be taken out on a joint life basis?
You can take out the life assurance plan on your own or with someone else. The cash sum is normally payable on the first claim only.