Life assurance is a lump sum payment in the event of your death.
A life assurance plan can be affected by a husband, wife, partner, etc, to alleviate financial hardship that may arise in the event of a death. It can be used to pay off debts, replace income, or simply make life more manageable for the deceased’s family. A life assurance plan can also be effected by business partners for Business Protection so as to purchase the deceased partner’s share of the business. It is unlikely that the remaining partners would wish that the deceased’s share of the business would be sold to a third party. A life assurance policy is most important when funds to purchase the deceased’s share of the business are unlikely to be available to the surviving business partners.
A life assurance plan, in the form of a mortgage protection plan, can also be affected to clear a mortgage in the event of a death. The bank providing the loan will normally insist that such a plan is put in place before the mortgage is drawn down.
A life assurance plan, in the form of an inheritance tax plan, can also be affected to offset the tax liability due on an inheritance and is an integral part of inheritance planning.
So ask yourself this, will you, your family or your business be financially secure in the event of the death of a loved one/family member/business partner?