Whole of Life Insurance
is the most comprehensive form of life insurance, covering the whole of
the policy holder’s life. This type may be compared with Term Life
Insurance, which pays only a lump sum if the insured dies during its term.
Types of Whole life Insurance
Two kinds of whole life
insurance exist; each offers its own benefits.
To decide between the two, do your research!
Maximum Cover Whole life Insurance features monthly payments that are
guaranteed to stay the same for a fixed period of time, typically the
first ten years. After that period, premiums may be reassessed and
increase.
Balanced Cover Whole life Insurance schemes support monthly payments
by investment to maintain coverage throughout the life of the policy
holder. If the investments do not perform well or charges increase, the
payments may become insufficient t maintain coverage and require
increasing.
Optional Additions to Whole Life Policies
Some additions and options may extend the coverage of Whole Life
Policies.
A Few Points To Consider About Whole
Life Policies
-
Combining Whole Life Insurance with Term Insurance will provide two
separate lump sums. (Check with each policy) One will pay off the
featured loan, such as a mortgage, and the other leave a lump sum to
cover the expenses of dependants.
-
Examining the past performance of any insurance company investment
fund gives you an idea if their managers have successfully used the
policy holder’s monies, and gives prospective customers information
regarding any increases they may expect to pay for premiums of balanced
cover policies.
-
Calculating the investment growth rate of the insurance investment
fund to predict how much it will cost to keep coverage at the same
level.
-
Ask if policies may be set up as trust funds, as these expedite the
payment of funds to survive family embers and offer significant tax
advantages by avoiding inheritance taxes, in some cases.
How Premiums are calculated for Whole Life Insurance
-
Premiums are calculated in the same manner as for any life insurance.
The age and health of the policy holder are two main factors to be
considered.
-
Non smokers typically receive far lower quote on Whole Life Insurance
since they are statistically less likely to die at an earlier age.
-
Women’s premiums differ from men’s because they tend to live longer.
-
Premiums depend on the length of the policy and amount insured.
-
Medical examinations may be required with a written report submitted
to insurance brokers.
-
The costs of any medical tests are met by the insurers.
-
A report from your regular GP may also be requested, as proof of
general good health.
Any incorrect information given on applications for Decreasing Term
Life Insurance may result in the policy being cancelled by the insurers,
so it is vital to answer all questions fully and honestly.
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