Consider investment life insurance

There are many different types of life insurance to consider, and we try to make it very clear that the most important decision you will make is the one to buy life insurance in the first place. So long as you take out one of the policies available to you, your family will be looked after and you’ll have total peace of mind.

Deciding which type of life insurance to then buy is slightly more difficult, because there are so many options. Many people are led by price, but there is a slightly different type of life insurance which see’s you effectively invest the money that your family would receive if you were to ever die, and it’s growing in popularity all the time.

Available in both term, and whole life forms, investment life insurance sees the insurance company invest your premium payments and the premium payments of everyone who signs up to the scheme into vary levels of the stock market, looking to make a better than average return on the investment.

If your family ever have to make a claim, then they will receive a payout from that fund, based on how well the fund is performing. If the fund has performed well over the period of the investment, then your family will be much better off. Equally if the fund has not performed well you do take the risk that they will receive less.

The advantage of such a scheme is that if you were to buy £100,000 worth of life insurance cover today, in 23 years time your family could make a claim and get £100,000, but over the 23 years with inflation and the cost of living increasing, that will only be worth a fraction of that amount.

If the money had been working in the stock market for the 23 years through an investment life insurance policy, then they’d receive a much higher payout, which would be more like the value of £100,000 in 23 years time, most likely double.

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