Pension Term Assurance

Pension term assurance is designed to pay out a lump sum of money in the event of the death of the policyholder within a certain period of time. If you are less than 75 years of age then you can have a pension term assurance policy without having to take out a pension plan.

This type of policy can be set up as either a level term insurance or a decreasing term life insurance policy with tax relief on the premiums that you are required to pay. It is worth noting that you cannot combine critical illness protection with a pension term assurance policy for additional cover.

Advantages

• Tax relief on premiums will be given at the policyholder’s highest rate of tax.
• This type of policy can help to provide you with a sum of money for your family and/or dependents in the event of your death.
• More affordable.

Disadvantages

• You may find that the premiums are often more expensive. Getting a life insurance quote is the only way you’ll really know though.
• If you take out this type of policy you will be unable to add a critical illness policy to boost your cover.
• If you outlive the length of your policy you will not receive any money.