Acumen’s guide to choosing a life insurance policy

How to choose a life insurance policy

With so many types of life insurance on offer, finding a policy that’s right for you and your family can be a daunting prospect. From level term life insurance to whole-of-life insurance, decreasing term life insurance and family income benefit life insurance, Acumen’s expert advisers can provide you with a tailor-made plan that protects your family’s financial security well into the future. Here is our complete guide to choosing a life insurance policy.

Choosing a life insurance policy

Securing the right life insurance involves calculating how much money you need to protect your dependents, taking into account their living costs and any outstanding debts you might have, such as your mortgage. The cost of your policy will depend on your personal circumstances, which is why it is worth bearing the following points in mind when choosing your life insurance policy:

  • Benefits and premiums.
  • Are policy fees built into your premiums?
  • Does the level of benefits decrease or increase?
  • Does the policy have investment or savings built in?
  • How much cash value can you accumulate in the policy?
  • Is it possible to convert a term policy into a whole life policy?
  • Do the new quotes match your insurance needs better than the old policy?

Types of life insurance policies

There are various different life insurance options available, including level term, decreasing, family income benefit and whole-of-life insurance. There are also other types of insurances that you might like to consider alongside life insurance, such as critical illness, health, income protection, medical and unemployment insurance.

Let’s take a closer look at some of the more common life insurance policies available.

Level term life insurance

A level term insurance policy lasts for a pre-agreed number of years. If you die during that term, it pays out a set amount. This simple and affordable type of life insurance will either cover a fixed debt, like an interest-only mortgage, or a lump sum for your dependants should the worst happen.

Decreasing term life insurance

Also known as mortgage protection, decreasing term life insurance policies last for a pre-agreed number of years, which usually coincides with the length of your mortgage. With the passing of each year, the pay-out decreases in line with your mortgage repayments. This type of policy is generally cheaper than a level term life insurance policy.

Family income benefit life insurance

Family income benefit life insurance is similar to level and decreasing life insurance, except that rather than a lump sum it pays out a regular income for the remaining term. By matching this income to your current salary you can ensure your family’s standard of living won’t change dramatically.

Whole-of-life insurance

Whole-of-life insurance policies ensure that, no matter when you die, your loved ones are guaranteed to receive a lump sum pay out from your insurer – rather than within a fixed timeframe. This type of policy is typically more expensive than shorter term policies but is useful for covering funeral expenses and for inheritance tax planning.

Tailored life insurance policies in Lancashire

For tailored life insurance advice in Lancashire or the wider North West of England, look no further than Acumen. Our expert advisers will analyse your situation, help you to identify your priorities, and recommend a tax-efficient life insurance plan that gives you and your family the maximum amount of financial peace of mind.

For more information about how life insurance helps families, or to arrange a meeting with one of our professional advisers, please contact Acumen today on 0151 520 4353 or to arrange a meeting with one of our experienced advisers.

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