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We are committed to providing customers with our lowest possible premiums for life assurance. To allow you to choose the best option for you we provide 3 routes to apply.
Life assurance (also known as ‘whole-of-life’ life insurance), is a type of insurance that continues indefinitely and pays out to your loved ones after you pass away. This is what sets it apart from life insurance, which is for a set term.
Arranging life assurance can be a daunting prospect, but as you’re reading this, then it’s probably on your radar. Life assurance is a very important product which protects the people you hold closest. But, like other people, you haven’t yet got round to sorting out your own policy.
In the below guide, we will explain exactly what life assurance is, how it works, help you work out if you really need it, and why there may be no better time than now to finally sort out cover for you and your loved ones.
First of all, you need to establish why it is you need life assurance. Below are a few scenarios which might ring true for you:
Leaving a legacy: life assurance is a good way of providing your loved ones with inheritance money when you pass away.
Providing peace of mind: Having a life policy in place, reassures your family that they can remain financially secure after your death. It can help them cover everything from living expenses to paying off a mortgage.
Funeral costs: A life assurance payout can help out your loved ones with the funeral costs, providing them with a lump sum.
Inheritance Tax: It can help your family deal with any bills associated with IHT.
Life Insurance (generally referring to a ‘term’ policy)
Most of the time, when people talk about life insurance, they’re talking about a ‘term’ insurance policy. Term life insurance is the most basic form of life assurance. With this policy, you’re able to choose the amount of cover you need and the period of time which you want to be insured.
If you were to pass away within this term, this will pay out to your loved ones. However, if you survive the term (which we hope you do), then the policy will not pay out, nor will the premiums you paid, be returned to you.
Life Assurance (also known as ‘whole-of-life’ life insurance)
The clue is in the name of this policy. We all, unfortunately, die one day, so as this policy is ongoing, it will pay out whenever that day comes.
Naturally, these policies may be more expensive than ‘term’ life assurance policies since so long as you keep paying your premiums this will always have to pay out, whereas you may outlive the term insurance policy.
We all know life insurance is crucial if you have family members who are financially dependent on you, however as you get older, your loved ones may have become more independent and are no longer reliant on your income. You may have now cleared your mortgage and your children may have since left the home to start their own families.
One of the main benefits of whole-of-life insurance is that it can help your family deal with any bills associated with inheritance tax. Currently, if an estate is valued at more than £325,000, inheritance tax will be charged at 40% on the value of the estate above that threshold (correct for the 2020/2021 Tax Year).
However, the tax will need to be paid before your loved ones are given access to your estate. This can put your family in a difficult position - they need to pay a tax bill which may run into (tens of) thousands of pounds, but they wouldn’t be able to use the money in your estate to do so.
As a result, many families are forced to take out loans just to cover this bill, which at an already upsetting time, may be particularly stressful. A whole-of-life insurance policy could help avoid this issue. The payout would provide the funds required to clear the inheritance tax bill without your loved ones needing to take out a loan or go into their own savings to cover it. This though, is reliant on the policy being written in trust.
Whole-of-life cover may also appeal if you are determined to leave some form of inheritance to your loved ones, or if you want to help with your funeral costs.
Many people who have a life insurance policy in place tend not to review it very often, however, it’s important to understand if the policy still meets your needs (as well as finding cheaper life insurance) - that’s where Cavendish can help.
The amount of life assurance that you need really depends on your personal circumstances and what you’d like to leave for your family.
There really are no rules around what your life assurance payout can be used for and therefore how much insurance you need, it’s more a case of thinking about your personal situation. Of course, the more things you want to support your loved ones with, the larger the cover you will need.
Life assurance is a completely personal product, which can depend on…
Age
Health conditions
General lifestyles choices
How much cover you want
As life assurance guarantees your family a payout, it’s worth understanding that it’s naturally more expensive than other, more basic, types of life insurance.
So, if you’re considering life assurance, it’s best not to delay, because we never know what’s around the corner.
Now we’ve hashed all the daunting details out and you’ve done your homework, it’s time for you to finally get yourself covered!
At Cavendish Online, there are a couple different options to help you find the best policy for you. You can either get a quote yourself, which takes just a few minutes of your time; just complete this form here.
Or, if you want some human interaction, you can choose to speak with one of our specialists over the phone, who are extremely friendly and will be able to help you choose the best cover for you and your loved ones.
Call us on 01392 241 850 to reach one of our helpful consultants, and tick another task off of the ‘to-do’ list!
If you have purchased your whole life insurance policy via Cavendish Online, then there will be no cash-in value, as we do not offer investment products.
If you have an investment product that you purchased elsewhere, it may be possible, but you should talk to your provider directly as we are not authorised to discuss them with you.
The insurance products offered by Cavendish Online have no cash-in value at any time. If you stop paying your premiums your cover will stop, your policy will end, and you will receive no benefit.
The insurance products offered by Cavendish Online have no cash-in value at any time. If you stop paying your premiums your cover will stop, your policy will end, and you will receive no benefit. If you have not claimed before the end of your chosen policy term, the policy will end, and no benefit will be paid.
