MBA FINANCIAL LTD
Life Insurance
What it does-There are two main types of life insurance:
Term life insurance policies: run for a fixed period of time (known as the ‘term’ of your policy) – such as 5, 10 or 25 years. These kinds of policies only pay out if you die during the policy. There’s no lump sum payable at the end of the policy term.
A whole-of-life policy: will pay out no matter when you die, as long as you keep up with your premium payments.
How it works – Life insurance is designed to provide you with the reassurance that your dependents will be looked after if you’re no longer there to provide. The amount of money paid out depends on the level of cover you buy. You decide how it is paid out and whether it will cover specific payments, such as mortgage or rent
What you need to know – Most people tailor their policy to ensure that their financial commitments would be met in the event of their death, so policies are often aligned with the term of a mortgage or other loan. Life insurance policies usually only cover death – if you can’t provide for your family because of illness or disability, you won’t be covered. However, some life insurance policies provide a terminal benefit, although these are not automatically granted