LIFE INSURANCE
The earliest known life insurance policy can be traced back to ancient Rome.
The burial clubs or burial societies at this time functioned in a manner akin to life insurance. Participants in these clubs would collectively contribute to a fund, and should a member pass away, the pooled resources would be utilised to handle funeral costs and offer assistance to the family left behind by the deceased member.
While not identical to modern life insurance policies, these ancient practices shared some fundamental principles, such as the pooling of resources to provide financial assistance in times of need.
Today, life insurance is a fundamental part of financial planning for individuals, businesses and families worldwide, providing financial protection and security in the face of life's uncertainties.
Ask yourself what financial consequences would your family face if you unexpectedly died tomorrow? If this question concerns you, be assured our advisers at Optima Health & Life are experts in advising on the best options for individuals, and couples on which insurances to arrange to protect your loved ones. Life insurance will be the solution, a contract between an individual and an insurance company, where the policyholder pays regular premiums in exchange for a sum of money to be paid out to their beneficiaries upon their death. This financial protection serves to provide a tax free lump sum payment, known as the death benefit, to the designated beneficiaries, helping to support them financially in the event of the policyholder's death or terminal illness.
Life insurance can offer peace of mind by ensuring that loved ones are taken care of and financial obligations are met after the policyholder's death.
By placing a policy in trust, the policyholder can stipulate how the proceeds should be distributed and managed, ensuring that the money is used according to their wishes and is available for intended beneficiaries. Another reason to use a trust is to ensure the proceeds are paid quickly and without any tax or creditor implications. By using a trust the proceeds bypass the estate of the deceased where it would normally be unavailable until probate is granted.
Insurance Options
Level Term Insurance
Ideal for family protection, this is one of the most straightforward types of term life insurance. The cover amount remains constant (level) throughout the policy term. If the policyholder dies within the term, a fixed lump sum is paid to the beneficiaries.
Increasing Term Insurance
The cover amount in increasing term insurance rises over time to keep pace with inflation. Premiums will also increase annually or at predetermined intervals. Ideal for maintaining the real value of your family protection
Decreasing Term Insurance
In this type of policy, the cover amount decreases over the policy term. It is often used to align with a decreasing financial obligation, such as a mortgage. The premiums are usually more affordable compared to level-term insurance.
Convertible Term Insurance
Convertible term policies allow the policyholder to convert their term cover into a permanent policy (such as whole life) without any medical questions. This provides flexibility and guaranteed options for those who may want to extend their cover in the future.
Renewable Term Insurance
Renewable term policies permit the policyholder to renew the policy at the end of the term without the need for additional medical questions. However, premiums for renewed terms may increase due to age.
Family Income Benefit
Instead of a lump sum, family income benefit policies provide a regular income to the beneficiaries in the event of the policyholder's death. This can be beneficial for dependents, offering a steady income stream for a specified duration.
Joint Life Term Insurance
This type of policy covers two individuals, typically spouses or partners, under a single policy. The benefit is paid upon the death of the first insured individual, and the policy then terminates.
Whole Life Assurance & Term to age 90 Insurance
Whole life policies pay out when you die. There is no expiry term so they are a guaranteed to pay.
Term to 90 plans run to a specific age (maximum age 90). If the policyholder survives beyond that age, the policy expires, and no benefit is paid.
Are you eligible for life insurance?
To apply for cover you must:
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Reside in the UK, with a legal right to live there and class your main home as being in the UK. You must have no current intention of moving abroad permanently.
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Be aged between 18 and 80 for most providers.