Jargon Buster - Definition of Sum Assured

Please select your letter of choice below to see the list of terms:

Sum Assured

is the amount of cover provided on an insurance policy. This amount is paid out in the event of a valid claim and is usually used in reference to life insurance and critical illness policies.

Some examples are:

  • For a life insurance policy, the sum assured is paid out as a lump sum or monthly benefit in the event of the death of the insured. This is also applicable for endowments and whole of life policies.
  • For a critical illness policy, the sum assured is paid out as a lump sum or monthly benefit upon diagnosis of a specified critical illness.
  • For a home insurance policy, the sum assured represents the maximum that you can claim for either buildings or contents.


With life insurance and critical illness policies, you can often choose to have a decreasing sum assured for a lower monthly premium. This is often referred to as decreasing or mortgage insurance and means that your sum assured will drop each year much like a repayment mortgage.


Please note that all definitions are intended for general guidance only. For official and current definitions you should always double check your policy wording.

If you are in doubt of the meaning of any terms, why not email us on info@topquoteuk.com

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