Jargon Buster - Definition of Whole of Life Insurance
Please select your letter of choice below to see the list of terms:
- Whole of Life Insurance
is a life insurance policy that doesn't have a term or cease date. The policy will pay out a lump sum in the event of death at anytime so long as the premiums are paid up to date.
There are two types of Whole Life Insurance: Unit Linked and Guaranteed. Unit Linked Whole Life Policies involve an investment element whereby your premiums are invested by the insurance company and the result of these investments will help to determine the premium payable in later years. Guaranteed Whole Life Policies have no investment and guarantee a specified payout in the event of a claim.
Whole of Life Insurance often works out more expensive that term life insurance because it guarantees to pay out at some point (as this policy pays out on death). One thing to ask yourself if applying for whole life cover is: will you will be able to afford the premiums in your 80s, 90s or even 100s?
Please note that all definitions are intended for general guidance only. For official and current definitions you should always double check your policy wording.
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