The Difference between Life Assurance and Life Insurance?
When looking into life insurance you’ll often see the term ‘life assurance’ pop up – and vice versa. It can be confusing as, in many cases, the terms are referring to similar products. But there could be an important difference and it’s worth knowing your assurance from your insurance in order to get the product that’s right for you.
What is life 'assurance'?
Sometimes when a company refers to life assurance it could be a type of Whole of Life policy. This cover normally does not have a fixed end date, so there is an ‘assurance’ that it could pay out whenever the policyholder dies no matter when that is.
What is life 'insurance'?
Life Insurance usually means that you are covered for a certain amount of time and when you apply you choose the 'term' of the policy. If you die within the term chosen, your loved ones could receive a cash sum. However, if you survive the term the policy will end and no cash sum will be paid out.
These definitions are intended to be a rule of thumb, so make sure you have all the information you need before you decide whether a policy meets your needs.