Protection for Life: Lifetime Cover
Frequently asked questions for Lifetime Cover
Click on the links below to find the answers to each question.
Do I need Lifetime Cover?
There are several reasons why Lifetime Cover may be important to you. It can help:
- give you peace of mind knowing you have some protection for the future
- provide a cash sum to help pay for bills or unexpected expenses when you die
- ensure that you’ve taken care of things for when you die
How does Lifetime Cover work?
Lifetime Cover is life insurance that lasts until you die. You pay an amount each month until you reach age 90. After age 90, your cover continues but you don’t pay any further premiums. You can take the policy out on a single life basis or with two lives assured. If there are two lives assured then the minimum sum assured is £15,001.
The cash sum you are covered for is called the benefit amount and it’s paid out when you die (single life basis), or if there are two people covered, when the last person dies.
What’s the difference between Lifetime Cover and Life Cover?
Life Cover provides cover for a specific term that you choose at the start of the policy. Lifetime Cover lasts for the whole of your life.
Instant decision on Lifetime Cover for benefit amounts of £15,000 or less
If you apply for a Lifetime Cover policy for a benefit amount of £15,000 or less on a single life basis, you’ll be accepted for cover in almost all circumstances* (exclusions may apply in some instances). The application process is simple with no medical**.
For some customers an exclusion may apply so that if you die within the first two years of the policy we won’t pay the benefit amount but will return the premiums you’ve paid under the policy. This is unless it’s an Accidental Death as defined in the Policy Provisions.
* To be accepted for cover you must be between the ages of 18 and 74, resident in the UK (meaning England, Wales, Scotland, Northern Ireland but not the Isle of Man or the Channel Islands) and have a UK bank account.
** As with all our contracts, we carry out random checks of recently started Lifetime Cover policies. If your policy is chosen we may request a medical examination or a medical report after the start date of the policy as part of our quality control procedures. An examination might include a simple test (e.g. saliva or urine sample) to confirm that you are a non-smoker. If the medical report highlights information that we asked for which you have not provided or shows that you have made a misrepresentation when providing us with information, we can amend the terms of your policy or at worst cancel your policy.
Can I take Lifetime Cover out with my partner?
You can take out Lifetime Cover on a single life basis or with two lives assured. Lifetime Cover with a benefit amount of £15,000 or less is only available on a single life basis.
Can I change the level of cover?
Yes. Once your policy is set up you have the flexibility to apply to change the amount of cover at any time. Some changes will lead to us carrying out further underwriting.
Can I choose who gets the payout?
Yes, by putting your policy in trust for the benefit of anyone you specify.
What is the Annual Plan Summary?
This is a statement showing the benefits you’ve chosen, the premiums you’re paying and any changes you’ve made to your plan. It’s worth considering your protection needs and making any changes to your Protection for Life plan at this time. We’ll also send you one of these statements when you make changes to your plan or benefits.
Why should you include additional trustees if you're putting your policy in a trust?
If no additional trustees are appointed this can cause complications if a claim is made as there may be no surviving trustee to ensure the terms of the trust are carried out. This would cause delays in payments being made to the beneficiaries who will likely need the policy proceeds as soon as possible, to provide them with the financial stability that the protection policy was designed to give.
Where there are no surviving trustees to administer the trust this will mean:
- If the last surviving trustee left a Will, probate/confirmation would need to be obtained by the executor(s) who can then undertake the role of trustee or alternatively appoint new trustees to administer the trust. The policy proceeds can then be released to the executor/trustees who in turn can distribute funds to any beneficiaries.
- If there's no Will, a Grant of Representation would need to be obtained and legal personal representatives would need to be appointed who can then undertake the role of trustee or alternatively appoint new trustees to administer the trust. This would be an even longer process and not a good experience for the people affected, which will likely be dependents who will need access to funds in the short term.
Also, if your trust is set up to allow for trust proceeds to be paid to a wide range of beneficiaries at the discretion of the trustee(s) and according to circumstances, at least two trustees would normally be required to allow the policy proceeds to be distributed to the intended beneficiaries. There would be a delay in payment until the trust period expires or a new trustee is appointed.
What would happen if the sole trustee was incapable of acting?
Having no additional trustees can also cause problems if a sole trustee becomes incapable of acting during his or her lifetime (by reason of a mental incapacity). It'll then become impossible to administer the trust without the intervention of the court.
What do I need to do to appoint additional trustees to my protection policy?
It’s easy to appoint additional trustees, you just need to print off and send us the completed Deed of Appointment of additional trustees form to allow the additional trustees to be added and ensure that there are no unnecessary complications if a claim occurs. Remember that your trustee needs to sign the form and it includes details of their duties and responsibilities.
There are notes in the left hand margin explaining what's required to help you complete the form. If you've any queries about how to complete this deed, please contact your Financial Adviser or your legal adviser.
Have we answered all your questions?
We hope you have found this summary of frequently asked questions helpful. If you have any further questions please contact us.