FAQs
Policy type
Term: Level term assurance is usually taken by people with Interest Only mortgages (where the amount of the mortgage will not decrease over its term) or for family protection. The policy is designed to pay out a lump sum upon death and in some cases upon diagnosis of a terminal illness (see below). A Mortgage Protection Policy, also known as a Decreasing Term assurance policy is most commonly taken out to protect a repayment mortgage. The value of your life insurance will reduce in line with your repayment mortgage. The premium will stay the same throughout the term.
Benefit Type
Life assurance only – this policy will only payout a lump sum upon death and often includes Terminal Illness cover.
Critical illness only – this policy will only payout a lump sum upon diagnosis of a specified Critical Illness.
Life insurance and/or earlier critical illness – this policy will payout a lump sum on either death, or diagnosis of a specified critical illness. Depending on which policy you take it can either payout on just the first event, or if necessary on both events.
Guaranteed & Reviewable Premiums
Guaranteed premiums are typically more expensive than reviewable premiums. This is because they will remain the same throughtout the term of the policy. The reviewable premiums will remain the same until the review dates. This ranges from 1 to 5 years after the policy starts. The premiums generally increase. Whether or not they change has nothing to do with the health or well being of the plan holder at the time of review.
Terminal Illness
Terminal Illness cover comes as standard with many life insurance policies. If you are diagnosed with a terminal illness and given less than 12 months to live you can put in your claim.
CIC options
“CIC” stands for Critical Illness Cover “TPD” stands for Total Permanent Disability “Comprehensive” includes both CIC and TPD. If this option is left blank, the quotations will then be based on the standard terms offered by the insurance companies.
Definitions of TPD
“Own occupation” is where you are no longer able to continue working within your own occupation. “Any occupation” is where you are unable to continue working in any form of work. “Any suited occupation”, this is where you are unable to either, continue working within your own occupation, or undertake any work that you have been trained to do, or been educated to do, or done in the past.
Term
Choose how long you would like the policy to run for. This is done in whole years. For instance if you have 24 years and 6 months left on your mortgage then you would enter 25 years.
Smoker status
If you have used cigarettes, cigars, pipes, or nicotine replacement products within the last 12 months, even if you have only used them occasionally then you should select Yes to being a smoker.
Occupation
Firstly enter your occupation and click ‘search’. You may then chose from the options provided. If you can not find your occupation you can leave the box blank, you will then be quoted under the default “Unknown” classification which assumes that you are in a non-hazardous occupation (class 1) such as an office worker.
Premium Frequency
Decide whether you would like to pay the premiums for your policy on a monthly or annual basis.
Premium driven
This option is the opposite to “Benefit driven”. If there is a particular amount that you wish to pay each month, or a budget you wish to remain within, then simply enter your chosen figure into the quotation system and it will tell you how much life cover you can get for that price.
Benefit driven
Select this option if you are looking to be covered for a specific amount of life cover. E.g. If you would like to be covered for £100,000.00 enter that figure into the quotation system and it will then let you know how much it will cost for precisely that.
Waiver of Premium
Select this option if you would like insurance for your premiums. In most cases if you are unable to pay your monthly premiums for more than 6 months in a row due to being signed off sick from work the insurance company will then pay your premiums for you. We recommend that you check the insurance providers policy details to see how this is applied.
Increasing benefit
If you select this option your policy will be reviewed annually by your insurance provider, and the amount of cover, as well as the premium will either be increased in line with inflation, or at a predetermined rate, for example 5% each year. Put simply, this will allow your policy to remain at its equivalent value throughout its term. This is not neccessarily beneficial for all policies, as in some cases you may only need to insure yourself for a specific sum regardless of when you may claim.
