It is a contract that pays a certain sum of money to your dependants if you die inside of the contract terms. This money can be used to pay off debts and pay for the funeral.
Why Get Insurance?
There are many reasons to get a life covering contract. One of these is to pay off a mortgage, this can be a hefty price and it is always good to not have to worry, or spend pension money on it. You may want children expenses covered if you’re children still live at home, or need to pay for university.
Different Insurance Types
There is a level term contract which lasts a pre-agreed amount of years, and if you die it will pay out a preset amount. The contract can cover a mortgage or provide money for the person’s dependants. This would be best for those people who have a mortgage and have many dependants.
Another contract is decreasing term, which is used for mortgages, but it decreases over time due to the mortgage cost decreasing over time. This is best for individuals who need a covered mortgage and their dependents can rely on their own work and life for their money.
Family income benefit contract is similar to the decreasing term, however, it instead, pays out a regular income rather than a single large sum. With this, you can make sure your family does not worry about diversifying their standard of living. This contract is best for people who need money for struggling dependants, as the individual is the main provider.
Whole Of Life Contract
This ensures the dependants get a payout for the dependants, no matter when the person dies. Because of this, the contract is usually more costly than the other insurances. This contract is great for those who have dependents who would suffer financially if the person died.