Life cover provides a one off cash payment to your family if you die during the term of the plan. This cash payment can be used to cover any expenses, debts and funeral expenses that you may have. Your family can use part of this money to invest or to provide a regular income.
Life cover can be provided for a set term or whole of life.
Serious illness cover pays a lump sum if you suffer from a common illness covered by a life company of your choice. You and your family can use this lump sum to pay off bills and to help provide an income at this time. Serious illness can strike anyone at any time and the effects can be terrible. Medical bills may be increased in addition to regular bills, at a time when income is reduced because of inability to work.
Income protection provides you with a regular income, which is paid out if you cannot work due
to an illness or injury. It is meant to replace some of your earned income if you can no longer earn an income yourself – making sure that you can still enjoy a comfortable standard of living. You can take out income protection if you are in full-time work or are self-employed and earn an income. It protects you only in these circumstances – it will not be paid if you become unemployed. An advantage of this plan is that you can claim tax relief on your payments to this plan at the marginal rate of tax.
INHERITANCE TAX PLANNING
To understand inheritance tax planning, you need to start with the facts, your personal circumstances and fully identify what your intentions are. Once this has been established, the next thing that needs to be reviewed is how to minimise any problems and plan for any tax implications that cannot be overcome. The three critical areas that need to be address are:
- Your intentions
- Succession to property
- Making a Will
PENSION LIFE COVER
Pension Life Cover provides a one off cash payment to your family if you die during the term of the plan. This cash payment can be used to cover any expenses, debts and funeral expenses that you may have. Your family can use part of this money to invest or to provide a regular income.
The advantage of Pension Life Cover is that it costs less because, if you are eligible, you can claim tax relief on contributions within limits. The plan will provide you with cover until the date you have chosen to retire.
MORTGAGE LIFE COVER
Mortgage life cover is the most basic cover that a life assurance company will provide. The plan is directly linked to your mortgage. The term of the cover is the same as the term of the actual mortgage. The level of cover reduces directly in line with the balance of your mortgage as you pay it off. In the event of your death during the term of the plan, your mortgage will be paid off in full.