Life Assurance: Protecting the Family

Recognizing the importance of life assurance to the social and economic development of the country, the government allows income-tax relief on your premiums as an extra incentive.

With most other types of insurance, a policy is a yearly contract which need not be renewed and where the premium can fluctuate from year to year. Life assurance, however, is far more scientific.

You are given a life-long contract where, in exchange for your paying level fixed premiums, your insurer agrees to pay you a fixed sum on your death or after an agreed number of years. The premium remains constant throughout the term of contract even though the risk of your dying increases as you grow older. Highly skilled actuaries apply probability techniques to compile statistical tables showing the chances of your living or dying for each year of your life, grouped according to your occupation, geographical area, age and state of health.

From these tables, known as mortality tables, the actuary assesses the rate of premium to be charged for every type of life assurance. For example, if 1,000 people aged 6o take out policies to provide their widows with lump-sums on their deaths, the actuary calculates for each future year how many of these people he expects to die and how much will therefore have to be paid out in death claims. He must ensure that all the premiums paid will be sufficient to meet all the claims until such time as all the policyholders will have died.


Life Assurance Protecting the Family

Payroll Giving
It’s all very easy to organise.
Just ask the Personnel or the Payroll Department at your company and, if they already have a scheme, they will give you the relevant forms.  HM Revenue & Customs’ website has a list of Payroll Giving agencies and explains payroll giving in more detail.

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read on: How long will you live?

Recognizing the importance of life assurance to the social and economic development of the country, the government allows income-tax relief on your premiums as an extra incentive.

With most other types of insurance, a policy is a yearly contract which need not be renewed and where the premium can fluctuate from year to year. Life assurance, however, is far more scientific.
You are given a life-long contract where, in exchange for your paying level fixed premiums, your insurer agrees to pay you a fixed sum on your death or after an agreed number of years. The premium remains constant throughout... see: How long will you live?