A whole of life policy is another policy which does exactly as it says. It covers you for the whole of your life. When the inevitable happens, providing the policy is still in force, it will pay out a death benefit. Although they can provide a surrender value, they should not be used for investment purposes due to the deductions made for the death benefit.
As payment of the benefit is inevitable Whole of Life policies tend to be more expensive than Term Assurance policies for the same level of cover (it depends on what age you are when you start the plan). Each premium is made up of a mortality element and a savings element. Upon death, a fixed sum is paid to the beneficiary along with the balance of the savings element. The performance of the underlying investment fund for Whole of Life Plans is important, as the cost of future premiums depends on fund performance.
These policies come in various forms:
Non-profit whole life policies - A level premium payable throughout life. It pays a fixed cash sum at the time of death.
With profit whole life policies - Same as non-profit policies but the amount paid on death is the sum assured plus whatever profits have been allocated.
Low cost whole life policies - These have a guaranteed level of cover that the amount payable on death is the greater of the basic sum plus bonuses or the guaranteed death sum assured.
If you are worried about investment risk and increasing premiums, there are Whole of Life policies available which do not rely on fund performance, however, these do not acquire a surrender value.
Please be aware that in some cases this type of assurance is based on an assessment of the health of the applicant.
THE VALUE OF INVESTMENTS AND THE INCOME FROM THEM MAY GO DOWN. YOU MAY NOT GET BACK THE ORIGINAL AMOUNT INVESTED.
THE PLAN MAY HAVE NO CASH IN VALUE AT ANY TIME. IF PREMIUMS ARE NOT MAINTAINED, THEN COVER WILL LAPSE.
Whole of Life policies
A whole of life policy is another policy which does exactly as it says. It covers you for the whole of your life. When the inevitable happens, providing the policy is still in force, it will pay out a death benefit. Although they can provide a surrender value, they should not be used for investment purposes due to the deductions made for the death benefit.
As payment of the benefit is inevitable Whole of Life policies tend to be more expensive than Term Assurance policies for the same level of cover (it depends on what age you are when you start the plan). Each premium is made up of a mortality element and a savings element. Upon death, a fixed sum is paid to the beneficiary along with the balance of the savings element. The performance of the underlying investment fund for Whole of Life Plans is important, as the cost of future premiums depends on fund performance.
These policies come in various forms:
Non-profit whole life policies - A level premium payable throughout life. It pays a fixed cash sum at the time of death.
With profit whole life policies - Same as non-profit policies but the amount paid on death is the sum assured plus whatever profits have been allocated.
Low cost whole life policies - These have a guaranteed level of cover that the amount payable on death is the greater of the basic sum plus bonuses or the guaranteed death sum assured.
If you are worried about investment risk and increasing premiums, there are Whole of Life policies available which do not rely on fund performance, however, these do not acquire a surrender value.
Please be aware that in some cases this type of assurance is based on an assessment of the health of the applicant.
THE VALUE OF INVESTMENTS AND THE INCOME FROM THEM MAY GO DOWN. YOU MAY NOT GET BACK THE ORIGINAL AMOUNT INVESTED.
THE PLAN MAY HAVE NO CASH IN VALUE AT ANY TIME. IF PREMIUMS ARE NOT MAINTAINED, THEN COVER WILL LAPSE.
When someone talks about savings and saving money, it could be referring to a piggy bank or a high interest deposit account. Savings are effectively cash or cash instruments
Wealth, just like your health, must be carefully preserved. Your assets need to be protected against the potential threats of erosion by taxation, the effects of inflation and investment risks.
When you retire you still need food and shelter as an absolute minimum, but of course you will want to maintain the lifestyle to which you have become accustomed
The main purpose of Life Insurance is to provide money for those people who may depend on you financially, in the event that something should happen to you.
Most of us face being taxed on our income, our capital gains, and in some circumstances the value of our estate when we die. Taxation can be very complicated and the rules, reliefs and allowances
Professional Financial Planning is the process which aims to help you realise your ambitions - whatever they may be. As professional financial advisers we can help you make informed decisions
