To many people, life insurance is essentially a death contract - money paid out when they die to be used to support family. However, there is more to life insurance than simply money payable on death - other events can be insured against to pay out than just the end of someone's life.
In response to an ever more competitive market, many life insurance policies now come with one or more freebies. One of these ubiquitous freebies is terminal illness cover, which allows a life insurance claim to be paid out in advance of the death of the insured. The proviso for this is that the insured must have a terminal illness and have a short life expectancy; also, if a terminal illness claim is made the policy will not pay out a second time on death.
Another add on available is critical illness cover; unlike terminal illness cover, this can be taken as a standalone policy or as a bolt-on to life cover. Critical illness cover pays out upon the diagnosis of a critical illness, with the definition of "critical illness" varying between insurers. Separate policies are more expensive but offer greater coverage, whereas a combined policy is cheaper but only pays out on the first event.
Another option available to those looking at life insurance is mortgage protection, which is basically life insurance set up specifically to repay a mortgage. This is generally level for interest only mortgages and decreasing for repayment mortgages. Critical illness and terminal illness are generally available to add to these policies, meaning more events are covered should the unexpected happen.
As with any major financial decision, consulting a financial adviser is usually a good idea before ploughing ahead with any choice, as they may be able to find you a policy you never thought of.
In response to an ever more competitive market, many life insurance policies now come with one or more freebies. One of these ubiquitous freebies is terminal illness cover, which allows a life insurance claim to be paid out in advance of the death of the insured. The proviso for this is that the insured must have a terminal illness and have a short life expectancy; also, if a terminal illness claim is made the policy will not pay out a second time on death.
Another add on available is critical illness cover; unlike terminal illness cover, this can be taken as a standalone policy or as a bolt-on to life cover. Critical illness cover pays out upon the diagnosis of a critical illness, with the definition of "critical illness" varying between insurers. Separate policies are more expensive but offer greater coverage, whereas a combined policy is cheaper but only pays out on the first event.
Another option available to those looking at life insurance is mortgage protection, which is basically life insurance set up specifically to repay a mortgage. This is generally level for interest only mortgages and decreasing for repayment mortgages. Critical illness and terminal illness are generally available to add to these policies, meaning more events are covered should the unexpected happen.
As with any major financial decision, consulting a financial adviser is usually a good idea before ploughing ahead with any choice, as they may be able to find you a policy you never thought of.
About the Author:
Visit Best-Life-Cover.co.uk to find the best deals in life insurance in the UK. Our advisors will help you sort through all the options such as critical illness cover and mortgage protection insurance.
