Whole life insurance UK
What is whole life insurance UK
Whole life insurance UK is one of the two most popular forms of life insurance offered in the UK, and provides customers with life insurance for their whole life. Life insurance is an insurance policy which pays out a lump sum to the family of a customer who dies, whilst in possession of a life insurance policy.
Life insurance comes in many different forms, although there are two main ones sold in the UK, with term life insurance, and whole life insurance UK the two most popular.
Term Life Insurance
Term life insurance is the most popular form of life insurance, and is also the cheapest. Term life insurance provides customers with a life insurance policy over a predefined term, and is usually offered at the same time as a mortgage.
One of the biggest advantages of term life insurance is its price. Because it is rarely offered past a customer’s 60th birthday, unlike whole life insurance UK which if offered for the whole life of the customer the majority of customers outlive their policy.
This means the insurance company do not have to make a payout, and have the customer’s premium payments as profit. This brings down the cost of term life insurance for everyone. One of the biggest complaints about term life insurance is the lack of return on investment, something that is not a problem with whole life insurance UK.
Whole Life Insurance UK
Whole life insurance UK provides customers with a life insurance policy for their entire life. This means that should they die at 35 or 135, their family will still receive a payout. This does make whole life insurance UK more expensive, as the insurer must recoup at least the payout from you in premium payments during your lifetime.
One of the biggest advantages of whole life insurance UK is that customers can start to borrow money against their final payout later on in life, when they have less of a need for a payout for their family.
The customers need for a payout is greatest when they have children to bring up and a mortgage to pay, but most people reach a stage in life when their mortgage is paid off, children have left home and their pensions have kicked in, and at this point they can start to borrow against their final payout as they have no need for a payout to their family.