Life insurance is designed to pay out on the death of the life assured, and may also provide benefits on the diagnosis of a terminal illness. A terminal illness is defined as an incurable illness where you would not be expected to live for more than 12 months.
At FD Protect we understand how hard it can be to lose a loved one. We also understand the financial implications.
Set it up correctly and Life Insurance will pay out a tax free lump sum to your chosen beneficiaries (when placed in trust) without waiting for probate. If a life insurance policy is not placed in trust then the proceeds will form part of your estate and are subject to inheritance tax.
Life insurance advisers at FD Protect ensure that all protection is implemented correctly so that in the event of your death or diagnosis of a terminal illness the proceeds are paid out quickly to your chosen beneficiaries.
The funds from a life insurance policy can be used to pay off your remaining mortgage or to ease the financial pressure for your family.
Life insurance gives you and your family peace of mind that in the unfortunate event of your death during the policy term, your family will be able to continue living in the family home and maintain a general standard of living.
Although the concept of Life insurance cover is rather simple, there are many different ways that a policy can be set up. We will help you ensure that you and your family are insured adequately in the event of a claim.
Basis of Life Cover
Decreasing Term Assurance: This type of cover is designed for repayment mortgages. The sum assured with this cover will reduce in line with you mortgage as you make repayments. The premium is calculated with the decrease in the mortgage balance accounted for and so premiums will remain level throughout the term of the cover. This is the cheapest form of Life cover available however it is not suitable for an interest only mortgage. In the event of premature death it will repay the loan amount outstanding on your repayment mortgage.
Level Term Assurance: This type of cover is designed for interest only mortgages or where you simply require a fixed amount of cover that will not change. The sum assured for level term assurance will remain the same throughout the whole term of the policy. In the event of premature death, this will provide a lump sum equal to the sum assured at the outset.
Indexing Term Assurance: This type of life cover is designed to mitigate the effects of inflation. The sum assured for Indexed life cover will increase each year in line with the Retail Price Index and the premium for this policy will also increase each year to accommodate the increases. Indexing Term Assurance is often used in conjunction with a Family Income benefit policy as it is designed to replace lost income in the event of death.
Type of Life Cover
Family Income Benefit: This protection policy is designed to replace the lost income of a significant other or family member in the event of their premature death. rather than a lump sum this benefit provides a monthly income (tax free) which can be utilised to raise dependents and to help ease financial pressure of losing some of the household income.
Mortgage Protection: Life cover can be arranged with a sum assured to match your mortgage loan. In the event of your death, your mortgage can be repaid in full to allow your partner and/or dependents to remain living in the family home.
Whole of Life: This cover is designed for the later years of life once you have little or no mortgage to repay and is put in place to protect and cover the inheritance tax liability that may arise on your death. For more information on this cover click here: Whole of Life.
Life cover can be written in to trust to ensure that in the event of your death, the sum assured is paid to your chosen beneficiaries of the trust via your trustees. Too many life insurance products are set up through price-comparison sites or through companies that do not properly discuss the benefits of a trust and as such many policies will therefore not avoid probate and can take months to pay out. Furthermore if a Life insurance policy is not placed in trust then the proceeds will form part of your estate, and as a result could be subject to Inheritance tax. .
Note that if a If the claim is made for terminal illness rather than death, the sum assured will be paid out to the life insured rather than the trustees.
Life Insurance advisers on hand from inception to claim.
Taking all of the above into account, we can help arrange your Life cover for you. We offer a face to face service so you do not have to deal with call centres or confusing paperwork. We’ll do everything for you from recommending the product to applying and getting acceptance terms from the insurance provider to chasing up doctors reports and arranging medicals where necessary. Our service to you is ongoing, we will keep you updated with any changes in premium rates or product specifications on an annual basis to ensure that you still have a competitive policy in line with your budget for protection. In the event of a claim we will be there to provide support with your claim and with any paperwork.