Whole of life assurance policies

A whole life assurance policy will pay out the sum assured whenever the life assured dies. This type of policy has no expiry date, and premiums will be more expensive than term assurance.

Whole life assurance policies generally come in three forms. Non-profit whole life policies have level premiums and pay a fixed sum assured. Some policies offer a cessation of premiums at a certain age. With profit whole life policies include any profits allocated up to date of death with the sum assured, including a terminal bonus in some cases. Low cost whole life policies are with-profits policies written with two sums assured: the basic sum plus bonuses or the guaranteed sum.

Single premium life insurance are simple unit-linked policies, written as whole life contracts. The premium is applied to purchase units in selected funds when put into effect, which can then be cashed in. If the assured dies, the death claim value will be paid to the beneficiary.

Terms and conditions such as ‘topping up’ and early surrender penalties vary between insurers. Property bonds and offshore bonds are two further unit linked whole life policies offered by some insurers.