Level Term Life Insurance Guide Discussion

busicat

"Little Information..." I know how you feel. Coincidentally just in the middle of experiencing the frustration of trying to get to the bottom of this.

It used to be pretty straight-forward that the policy would always be free of inheritance tax if under a trust you can't benefit from (though some experts fret that to be 100% sure, premiums should not come out of a joint account with your wife ....daft IMHO, but that's what they say.)

The good news is that the life cover will still NEARLY always be free of IHT. The bad news is it's mind-bogglingly horrible trying to work out what might be payable in the very unlikely but possible event that a bit of tax might now be payable. (If you look at life company trust guides, they talk about the possible 10 year or exit charges if the policy has a value at a 10 year anniversary ie if the proceeds become payable but not yet paid to the beneficiary before the anniversary or if you were seriously ill just before such an anniversary. Random madness.)

So it's definitely worth doing still (I am just giving my understanding, not being authorised to give legal/tax advice) ..but in the rare event some tax might be due, it seems to be 6% on the excess of your £500,000 over your nil rate band for the 10 year periodic charge. Then they mention an exit charge for when the money gets paid to your wife or daughter, which I still haven't got my head round. Insurers say the exit charge depends on the rate of the previous periodic charge. But I can't believe that means a repeat of the same amount gets paid again! Will let you know if I find out.

maria3104

Hi

I took out term and critical illness ins in 2012 with lv and aegas.

It covers MS, but does not mention devics disease or as it is now known as NMO,neuro mylitis optica, it used to be considered a type of MS but is now a standalone disease since 2012.

Where do I stand? Will they pay? I had no symptoms since onset in 2015 and there is no non disclosure or any concern other than if I am diagnosed and it is not on their list as now classified as its own disease will they pay out? in 2010 devis was part of MS.

I am waiting for a diagnosis and expecting devics, I am obviously very concerned. I hope and pray to not have this awful disease but would like to know where I stand if my diagnosis.

Thank you,
M

Nearlyold

To be honest I think you'll only know for sure when and if you put a claim in. Have you spoken to the insurance companies claims department?

maria3104

Hi nearly old,

Not yet, I am trying to be sensible and await the diagnosis confirmation.

I always rush my fences. I hate uncertainty.

Thanks for the suggestion, I had not thought of it and if there is to be a lengthy delay I may well do this.

I live in hope I am fine and all the clever Drs are mistaken!

Maria

retriever01

Hello everyone, I am a newbie to this site.
My fianc! and I are going through the process of selling and buying a property at the moment.
We were looking at a post on MSE, Mortgage Life Insurance, and have a query about Point 9 "quitting cigarettes lowers your premium".
It states "To count as a non-smoker, you need to have been genuinely nicotine-free for at least a year".
We both stopped smoking on 8th June 2014 and since then have been using an electronic cigarette which has 0.6% nicotine strength.
So when we apply for mortgage life insurance are we actually classed as non smokers or as it states 'nicotine-free' that we are still classed as smokers?
Thank you.

kingstreet

You remain nicotine product users and therefore remain smokers in the eyes of the insurers.

missis_amber

35 years old, mortgage of £83k, young dependent - level term of 25 years or 30 years? And is £100K life cover plus £25k critical illness cover reasonable?

christina25_2

Hi All,

I have been paying term assurance healthcare insurance since 1995 and thought I was covered for disability. I thought I was eligible to make a claim on the basis that I have a disability that prevents me from doing my job. I found out when I read the small print that I am only covered if I work full time. I have never worked fulltime and was sold the policy with my mortgage when I worked part time. The policy is has always been useless as it only covers fulltime workers.

Does anybody know if I can ask for the money I have paid into this policy as it was missold to me?

dunstonh

christina25 wrote: »

Hi All,

I have been paying term assurance healthcare insurance since 1995 and thought I was covered for disability. I thought I was eligible to make a claim on the basis that I have a disability that prevents me from doing my job. I found out when I read the small print that I am only covered if I work full time. I have never worked fulltime and was sold the policy with my mortgage when I worked part time. The policy is has always been useless as it only covers fulltime workers.

Does anybody know if I can ask for the money I have paid into this policy as it was missold to me?

Can you clarify what insurance you have as term assurance is life assurance. That doesnt cover disablity as its not that type of insurance. Healthcare insurance sounds like private medical insurance. i.e. ability to go private with medical conditions.

Serendipity_1_2

Hello,
I have a young child and am about to become divorced. It has been suggested to me and the child's other parent that we should each take out life insurance naming the other parent as a beneficiary, to help the remaining parent cover the cost of raising our child. If we do this, is it possible to write the policy in trust so that we are not hit by inheritance tax? Or can there be advantages to just naming the child as beneficiary, again with the policy in trust? I am thinking for example of a scenario where the remaining parent for whatever reason was not able to look after the child. Appreciate that nobody can give financial advice on here but if you have any comments I would be grateful.
Thanks in advance