Whole Life Insurance

Whole-of-Life Insurance pays out a specific lump sum at the time you die, whenever that should be. Unlike term insurance, this type of policy is not limited to a particular period. This policy supplies extensive protection; you know your family is financially protected whenever you should die. As long as you maintain the policy there is a guarantee that, on your eventual death, the sum assured will be paid to your estate.

Premiums for this type of policy tends to be more expensive that term life insurance in the short term, as it is certain that the insurance company will eventually pay the sum insured. However, cumulative premiums are roughly equal if policies are kept in force until average life expectancy. Premiums are usually paid monthly, and must be maintained in order to ensure that the cover remains in place.

Some policies you will require you to pay the premiums until you die, while others will allow you to stop paying at a certain age (for example, at 65 or 80) at which point the policy becomes "paid up". Although you will have stopped paying the premiums, the insurer will still pay the sum insured when you die.

Whole life insurance can be arranged with or without profits or can be unit-linked.