Life insurance is an insurance policy that provides your family or designated beneficiary a sum of money in the event of your death. In exchange, you pay a monthly payment (premium) in order to insure yourself. This provides you peace of mind that your family will not have to worry about finances after you’re gone.
Life insurance is a great value if you find the right plan. Premiums will vary greatly by plan and provider and depend on both what you’re looking for and your own age, lifestyle, and health. Many times, however, it can cost as little as a few pence per day to insure yourself.
This will also vary greatly by plan and provider. Policies can be as low as £10,000 or well over £1 million. Generally speaking, the higher your premium, the more coverage you will have.
This is the person or persons you designate to benefit from your life insurance. In other words, your designated beneficiary is the person who will receive the sum of money in your life insurance plan.
Life insurance does not cover injury or disability, even if the insured can no longer work. It typically does not cover illness either, and it’s difficult to get coverage if you have serious pre-existing conditions.
However, some life insurance policies will pay out in the case of certain terminal illnesses.
Most providers will include exclusions in their life insurance policies to mitigate risk. These are certain circumstances under which the life insurance plan will not pay out to your beneficiaries. They vary by plan, but usually include suicide, war, fraud, illegal activity, and drug use.
It is up to you. You can choose to have your beneficiary paid in a lump-sum or to have your policy paid out in the form of regular income.
This depends. Unless you've specifically requested it as part of your policy, then the funds won't be initially available to your loved ones. This is due to payouts being delayed by questions around the cause of death, and other times insurance providers are too slow to send payments before a funeral is organised.
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