Life Assurance Plans

Sometimes the death benefit (or "life cover") provided by the Job or through the Police Federation Scheme is not enough to meet your individual needs. We can provide competitive life assurance plans that meet your requirements - either to repay your outstanding mortgage or provide financial support for your family in the event of your death. Peace of mind for you - just in case the unexpected happens.

These life assurance policies are designed to repay the loan under a repayment or interest only mortgage if you (or your partner if covered) die during the term of the policy. The policies will usually pay out early on diagnosis of a terminal illness and there is the option to include critical illness cover - see Key Features - Questions and Answers 'when WILL the plans pay out?'.

Why do I need life cover?

Moving house is an obvious time to take out a plan, but it also makes sense to look around at other times. For instance, your needs might change if you re-mortgage or the size of your family increases, or others are dependent upon your income. Premiums for life assurance have fallen in recent years. You could well find that you save money by replacing your current cover with a new plan, or adding a new policy to top up your cover provided by the Job or the Police Federation Scheme. Obviously, you will need to be in good health if you want to do this.

Maybe you did not take out life cover when you first had your mortgage - but now consider it prudent to have some protection in place? Whilst it is generally preferable to effect cover when you are younger and in good health - peace of mind is always desirable.

Mortgage Protection Plan or Level Term Assurance?

Most mortgages are on a repayment basis where you pay off capital throughout the term - albeit quite slowly in the early years. The life cover on a Mortgage Protection Plan reduces each year so that it is sufficient to pay off your outstanding loan, but also so that you do not pay for more cover than you need.

Alternatively, if you have an interest only mortgage, or other need of life cover, you probably need a Level Term Assurance. This means that the full sum insured for the event of your death is paid out at any time during the term of the plan. There is no payment if you survive - again to keep down costs.

The level term assurance policy can provide life cover for any purpose - not only to protect an interest only mortgage.

What other choices do I have?

If you want two lives to be covered, you may be considering one joint life plan, which will pay out on first death to the survivor. However you should bear in mind that should this happen the plan will then cease, leaving the survivor with no cover and with the cost of replacement cover being higher due to age or perhaps poorer health. Why not consider a separate plan each. You will also then be entitled to apply for critical illness cover, and may write the plan(s) in Trust.

Critical Illness - if your plan is single life and the plan will expire before your 60th birthday, you can opt to have critical illness cover included in the plan. For more details and examples of the cost of this valuable additional cover, see Key Features - "Question & Answers".

If your plan is single life you can write your plan(s) in Trust to ensure a speedier payout to the people you have chosen, without going into your estate - usually ensuring Inheritance Tax is not payable on the death benefit. Either type of policy, Mortgage Protection or Level Term Assurance, whether it is already in force or you are just applying for it, can be put in Trust to protect against Inheritance Tax and to speed up payment on death. For more details of the Trust we offer, see here.

For full details please see the documents on the right.