Life Cover

This provides a lump sum in the event of your death.  There is a wide range of term insurance options to chose from.  You can pick the term of years and the amount of cover you wish.  Premiums will depend on your age, your gender and the term of the policy.  Non-Smokers are charged less and your state of health is taken into account.  At proposal stage, Insurers may require you to undergo a medical or receive medical information from your doctor but as with all insurance policies, it is very important to provide full information regarding your health when completing your proposal form.

1. Term Assurance
   
   This is a life insurance policy for a specific amount of cover, for a specific term to be paid out in the event of your death.  You can pick Level Term (the sum insured and premium remains fixed for the term of the policy) or you can have Indexation included in this policy whereby the premium and benefits will increase each year by a specific amount,( i.e. between 5% and 8% per annum), not requiring any further medical evidence.
   
   There is no savings element to this policy, i.e. no encashment value.  At the end of the specific term, that is the end of the policy and if you wish to have further life cover a new policy would have to be taken out, once again, subject to medical evidence etc.
   
    
2. Convertible Term Assurance
   
   This provides the same basic cover as Level Term Assurance, but with the option to convert the policy into another type without medical or additional proof of good health.  The policy which you convert to will operate from the date of conversion and will be rated based on your age at that time.  You will not however be able to have indexation on this policy without being subject to medical evidence.
   
   There is no savings element to this policy, i.e. no encashment value.  At the end of the specific term, that is the end of the policy and if you wish to have further life cover a new policy would have to be taken out, once again, subject to medical evidence etc.
   
    
3. Decreasing Term Assurance
   
   These policies are also known as Mortgage Protection Policies and are the cheapest way of covering your mortgage.  Once again there is no savings element with these policies.  Benefit is only in the event of death.
   
   This is where you take out life cover (normally equal to your mortgage amount) for a guaranteed term, with a guaranteed premium.  The amount of life cover reduces each year in line with your capital interest repayment on your mortgage.  (E.g. A policy taken out for a sum insured of €100,000 over a term of 20 years.  If the insured person dies in the first year, his/her family will receive the full €100,000; however by year 10 this would have reduced to approx. €80,000 and in the last year the cover would only be approx. €12,000).
   
   Most lenders require borrowers to take out Mortgage Protection Policies.
   
    
4. Whole of Life
   
   A whole of life policy is the same as a Term Assurance Policy except has no pre-determined term and they provide more flexibility.  Once again a lump sum payment is made upon the death of the insured person. 
   
   As these policies have no specific term and are for the duration of your lifetime they are more expensive than for a similar Term Assurance Policy. 
   
   You can chose to pay premiums for a specific period (e.g. 10, 15, 20 years) or the rest of your life.  These policies are reviewed regularly, normally after 10 years to ensure you are paying enough premium to maintain your cover.