Life insurance policy UK
What is a life insurance policy uk?
A life insurance policy uk is an insurance policy that will pay out a lump sum to the family of a customer who dies. The most common time to take a life insurance policy uk is when you take out your first mortgage, although with the average age of a first time buyer now pushing towards 40, a life insurance policy uk should be a priority far earlier than this.
How does a life insurance policy uk work?
A life insurance policy uk is a relatively simple insurance policy. A customer will be given a life insurance quote when they want to take out the policy, which will be cheaper the younger they are, and the healthier their lifestyle is.
They will pay this policy for a certain term, in exchange for a lump sum payment when they die. The time that this lump sum payment is valid will vary dependant on the type of life insurance policy uk.
There are two main different types of life insurance policy uk, term life insurance and whole life insurance.
Types of life insurance policy uk
Term life insurance is the most common form of life insurance, and is also the cheaper of the two policies. Term life insurance is offered over a set term, and is rarely offered beyond a customer’s 60th or 70th birthday. If the customer dies within this term, they will receive a pay out, but after that term the insurance expires.
Term life insurance is so popular because it covers a customer during their period of greatest financial responsibility, and makes sure that if the customer dies while they still have an outstanding mortgage, or young children to look after that the costs associated with these will be looked after.
Whole life insurance is offered for the entire life of a customer, however old they get, and this is far more expensive as the insurance company know they will nearly always have to pay out eventually. A whole life insurance policy uk will have to cost at least the value of the pay out over the term of the policy payments, or the insurance company would not make any money .
To buy a life insurance policy uk you can compare life insurance policies on this website.