Life Insurance Advice in Nottingham

Different Types of Life Insurance in Nottingham

Finding the right Life Insurance product for your individual needs can be difficult, especially since there are so many different policies. As a Life Insurance Advisor in Nottingham, we have been able to help many different types of customers find a policy that matches their personal circumstances:

Level Term Life Insurance

With Level Term Life Insurance, your policy will only pay out within a fixed ‘term’. The most popular term length is between 15-25 years. When you are defining your policy conditions, you can narrow or extend your term in 5-year increments. The lump sum that is paid out will always remain the same no matter the length of your policy. The only way it would not pay out would be if you pass away outside of the fixed term.

Level Term Life Insurance is typically taken out to cover a mortgage. When you take out the policy, you can define the length to run in line with your mortgage term, therefore, if you were to die before paying off your mortgage, Level Term Life Insurance will cover the remaining payments. This also means that the remaining mortgage payments will not fall to family members or any other name attached to the mortgage.

Decreasing Term Life Insurance

Customers often ask, “why would you want a policy that decreases in value?”; the simple answer is that this policy mirrors the amount remaining on your mortgage. Unlike Level Term Life Insurance where the amount that is paid out remains the same throughout your fixed term, the amount that is paid will be equal to the remaining amount on your mortgage. As the amount owed on your mortgage decreases, so does the sum insured.

When people take out this Life Insurance product, depending on their personal circumstances, they usually take out another Life Insurance policy alongside it. This policy will only be valid for the duration of your mortgage, so, if you were to die outside of this term, nothing would pay out to cover other financial debts, bills in your name.

Increasing Term Life Insurance

Increasing Term Life Insurance increases as you get further into your term. It will increase by a fixed amount until your policy term ends.

This life Insurance policy also compensates for the total value against inflation and is usually in line with the retail price index.

Whole of Life Insurance

The Whole of Life Insurance policy is the most costly policy of these products, as it covers your whole life. When you pass away, the policy will pay out. The only way that a Whole of Life Insurance policy will not pay out is if you fail to keep up to date with your monthly payments.

We’ve seen that customers seem to use it for family protection or part of inheritance tax planning.

Joint Life Insurance

This policy covers people in relationships/married. It allows you to combine two Life Insurance policies into one under both names.

Joint Life Insurance policy that will pay out in the event of one party passing away. It’s not unusual for each party to take out their own individual policies, that method is completely fine, however, it can be more cost-effective to take out a Joint Life Insurance policy that covers you both.

The only downside to that policy is that once it pays out, the policy ends, even for the other partner. You can always take out another Life Insurance policy for yourself after the Joint Life Insurance policy has expired if you wanted to.

Death in Service

Death in Service Life Insurance can be offered to you by your employer. Your company is not obliged to provide Death in Service cover, however, some may offer it as part of their employee benefits package.

Death in Service pays out a lump sum to the employee’s family or a person of their choice if they pass away. This sum can be up to 5 times their annual salary. There are no limitations on what can be done with the money that is released from the policy.

The policy payout has nothing to do with if an employee dies in the workplace.

Taking out Life Insurance as a Single Homeowner

As a Mortgage Broker in Nottingham and Life Insurance Specialist, we’ve seen many sole homeowners disregard the idea of taking out Life Insurance. Most sole homeowners don’t realise that their remaining debt, unpaid bills and mortgage payments will fall to their family if they die without cover.

We suggest that you think about your future circumstances and look to see whether things could change. For more information on how Life Insurance can affect you as a single homeowner, contact us and speak to one of our Mortgage Protection and Insurance Specialist in Nottingham. During your free insurance review, we can find out whether taking out Life Insurance as a single homeowner could be beneficial for you.