There are three main types of life insurance or term assurance plans. You can simply protect those who depend on you against your death by taking out Life Cover. You can be covered if you're diagnosed with a serious illness like a heart condition or cancer (some forms of heart conditions and cancer are not covered under a critical illness policy. Please see individual policy conditions for full details). This is up to six times more likely to happen to you than dying before age 65. This type of life insurance is called Critical Illness Cover. You can protect against losing your income through disability, no matter how it’s caused with Permanent Health Insurance (sometimes also referred to as Income Protection). Life insurance and critical illness cover can be purchased at the same time, and in different ways: Level basis - fixed premiums for a fixed number of years and a full payout on claim at any point. This is almost almost always the right choice for family protection and "interest-only" mortgages. Increasing basis - costs more, but cover goes up every year without any medical (and so does the premium). This is not so popular, but should be because people need more cover as inflation and their income rises. Decreasing basis - a cheaper option as premiums are lower to begin with. Payout reduces over the cover period, in line with a repayment mortgage. This is not much good for anything else, but ideal for those on a tight budget. Renewable basis - a short term policy - which makes it cheaper initially, but more expensive long term. Importantly, it can be renewed without medical evidence. Any claim can be paid as a lump sum, or as a monthly income with Family Income Benefit. You should seriously consider putting your policy in trust. This means that the proceeds of your cover will be paid in a straightforward way to your dependants without affecting your will, your estate or the taxman. Prior Knowledge does not charge for advising on and arranging trusts. Call Prior Knowledge today on 0800 804 8464 and make a convenient appointment in the comfort of your own home. Your home may be repossessed if you do not keep up repayments on your mortgage For mortgage advice we can be paid by a commission or fee of usually 0.4% Prior Knowledge - bringing the high street to your home | 
