Term Assurance
There are many types of term assurance. Below are the main types of term assurance available within the UK.
Level Term Assurance
Level term assurance is an insurance policy that you would take out if you wanted the amount of cover to stay the same though the whole term of the policy and not decrease over a period of time. A good reason for takign this cover out would be if you were on an interest only mortgage, or if you wanted to ensure that your mortgage and debts would be covered, and you would have extra money to cover cost, for example for the funeral, or to live off for a period of time shortly after the death of the insured.
Decreasing Term Assurance
Decreasing term assurance is a policy that would start off at a certain amount of cover, but over time the amount of cover would reduce. You are albe to vary the rate at which the cover amount decreases at, usually 8% – 12%, however most insurance companies allow you to choose at what rate the cover decreases subject to their individual parameters.
The benefit of a decreasing term assurance policy would be to someone that was on a repayment mortgage so their debts are reducing over a period of time in line with the amount of cover on the term assurance policy. With this policy you are not really going to see any extra money after your mortgage is cleard unless you are insured for a considerable amount more than your debt, or you opt for a higher rate at which the policy reduces compared to your debts.
Increasing Term Assurance
With increasing term assurance the potential payout of ther term assurance policy increases by a small amount each year to keep in line with inflation so that in 20 years time the amount that is payed out is in line with the costs of living at that time. This term assurance policy can be used for many different reasons. However the level and the decreasing term assurance policies are the more popular polies that people tend to take advantage of, read more »
Convertable Term Assurance
With convertable term assurance the policyholder has the optiion in the future to be able to switch their convertable term assurance policy to another type of life insurance policy that will more suit their needs, for example an endowment, or a whole of life insurance policy without having to submit or prove any evidence of their medicle history since first taking out the convertable term assurance policy. This is a benefit if you think that a different term assurance or life insurance policy benefits you now compared to in the future.
Where to Gain more information For Term Assurance
If you are looking to recieve more information regarding term assurance policies or you would like to know what it covers, and who is able to apply for a term assurance policy then the internet has many different resources for you to hand at no cost most of the time. You can also refer your enquiry to a qulified insurance or mortgage broker who will be more that happy to assist you in your enquiry.
Advanced Finance Limited are an independant mortgage and insurance brokerage based in Essex, UK and are experts in term assurance for their clinets. If you would like more information or you would like to apply for any of the above term assurance policies then simply complete the above form for a qualified mortgage or insurance broker to call and help you with your needs, or you can call us on 08449 111 000 for a free consultation and quotation today.