Life insurance is protection against financial loss that would result from the premature death of an insured. The named beneficiary receives the proceeds and is thereby safeguarded from the financial impact of the death of the insured. The death benefit is paid by a life insurer in consideration for premium payments made by the insured.
- Term Assurance: Some life assurance policies are designed to meet temporary life cover needs. A term assurance policy is designed to provide protection during the fixed policy term. There is no investment element in such policy as it provides pure protection.
- Whole of Life plan: As the name suggests, the plan term is open ended, i.e. continues throughout the lifetime of the life assured, and provides a sum assured which is payable on the life assured’s death. It contains an investment element, and will build up a cash value as well as provide funding for the cost of future benefits throughout the client’s lifetime. The emphasis is on providing protection benefits.
- Critical Illness Insurance: This can be an added benefit to a life insurance plan. While your health insurance should cover the cost of treating a serious illness, Critical Illness Insurance exists to alleviate financial worries during the time of a critical illness and beyond. It may mean that expenses such as mortgage payments, nursing costs, child’s school fees can be difficult to cope with. It provides a lump sum payment that can be used for anything should you be diagnosed with any of the specified illnesses on your policy, such as heart attack, cancer or a stroke allowing you to focus on your well-being and recovery. Critical Illness Insurance can only be purchased while an individual is in good health; unfortunately once diagnosed with a serious illness one cannot avail of this essential cover.