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Life Assurance

Independent insurance advice - learn when Life Assurance cover is necessary and how to ensure your policy offers the best protection at the best value.

Almas Uddin
Almas Uddin

Founder and Mortgage Advisor

Almas Uddin2024-06-15
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Life Assurance

Life Insurance vs. Life Assurance 

Business loan broker are independent insurance experts, and pride ourselves on offering the best deals in the market, as well as providing professional advice.

If you need any help choosing which insurances to buy or finding the most competitive rates give us a call!

How Do Life Insurance and Life Assurance Differ?

Life insurance covers you until a fixed expiry date, at which point your policy ends. 

Life assurance covers you until your death, regardless of how long that may be from the date you first took out your policy.

Life assurance is also referred to as whole of life insurance, or permanent insurance since it never expires.

Should I Choose Life Insurance or Life Assurance?

Which product is best for you depends on lots of circumstances. Most people insure their lives to provide financial security for their family in the event of their death, or to cover lending such as mortgage payments should they no longer be around to cover those costs. 

Life insurance is the better product for shorter-term insurance, for example until your mortgage is paid off, or until your children reach a certain age. The premiums will be lower, and the policy will expire when your agreed end date is reached.

Life assurance is better if you wish to protect your family in the event of your death, and would like to provide financial support for them whenever that may be. Life assurance is also used to plan for liabilities such as inheritance tax.

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Pros And Cons Of Life Assurance

Pros:

Peace of mind, knowing that your family will be financially comfortable when you pass away
Lasts until your death, without any expiry date
Can be used as a form of investment

Cons:

Can be an expensive product to purchase, since it lasts indefinitely
May require a lifetime of regular premiums to keep your policy active

Pros And Cons Of Life Insurance

Pros:

Covers your family for financial liabilities in the event of your death
An affordable form of insurance to cover debts up to their repayment

Cons:

Only pays out if you die within the term of the policy
You will need to purchase new cover should you wish to extend your insurance past the expiration date of your life insurance
Premiums become more expensive as you get older

Which Product Should I Choose?

If you are not sure which option is best for you – financially, in terms of premium costs, or with regards to pay outs, give Revolution Finance Brokers a call.

Life insurance can be expensive but provides huge peace of mind. However, choosing the right policy is essential to ensure you don’t spend more than you need to on premiums and have the right policy in place to support your family.

How Does Life Assurance Act As An Investment?

Life assurance is both insurance and an investment product. Your monthly premiums are split into two parts, with one proportion of the premium being banked towards the final pay out to be made to your beneficiaries, and the other proportion being used as investment funds.

Your life assurance policy will state a minimum pay out in the event of your death, but the more funds invested in your policy, and the more successful the investments made with those funds, the higher the value will grow.

This is also known as life assurance with benefits, with the benefit being the growth in fund value as a result of the investments made. 

You can cash in some of the funds in your policy, or could choose to close your policy and claim the fund as a one-off lump sum. However, they may be an exit penalty payable that will be deducted from the cash pay out.

If you are considering using life assurance as an investment, give us a call. We can explain the ins and outs of how this works, how best to set up your policy, and how to achieve maximum return on your investment.

Almas Uddin
Almas Uddin

Founder and Mortgage Advisor

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Frequently Asked
Questions

Life insurance expires at a fixed date. This means it is ideal to provide cover for your children until they reach a certain age, or protects against the value of your mortgage until it has been paid off.

Life assurance does not expire and guarantees a minimum pay out value to your beneficiaries whenever you die.

When thinking about the future, and supporting your family if your circumstances change, there are several other products to consider:

- Mortgage protection insurance
- Income protection insurance
- Critical illness cover
- Disaster insurance
- Health insurance

If you are unsure which are the most stable products, or which would provide the most benefit to your family, get in touch and our friendly team will walk you through the pros and cons of each.

No, these are two different types of policies.

Life assurance pays out to your named recipients when you die – no matter how many years away that might be.

Critical illness cover provides a pay out, also usually a lump sum, and is claimable if you are diagnosed with a serious illness, disability or condition. 

Life insurance is a middle ground, as usually if you are diagnosed with a serious illness and have a life expectancy of fewer than 12 months, your insurer will pay out at the point of diagnosis. 

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The content included in our articles, blogs, web pages and news publications is based on information accurate at the time of writing. Note that policies and criteria can change regularly throughout the UK mortgage lending market, and it remains essential to contact the consultation team to receive up to date guidance. The information included on the Revolution Brokers site is not bespoke to any circumstances or individual application scenarios and therefore is not intended to be used as financial advice. The content we share is designed to be informative and helpful but cannot be relied upon to provide individual advice relevant to your mortgage requirements. All Revolution team members are fully qualified, trained and experienced to provide mortgage advice of an independent nature.

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