Whole of Life Cover | Future Proof Insurance

Whole of life insurance is a life insurance policy that is guaranteed to pay out a lump sum whenever you die. The policy has no end date. It ends when you die and a claim is made. It is important to note that premiums must be paid and kept up to date. If you cancel or stop paying your premiums, you won’t get any money back. There is no investment value in the Whole of Life Insurance policies which we arrange.

Whole of life insurance is a life insurance policy that is medically underwritten. Read our guide about how whole of life insurance works.

1. One of our friendly advisers will need to ask you questions about your:

• Age
• Weight
• Lifestyle – smoker or non-smoker?
• Occupation if you are still working
• Medical history
• Amount of cover required – we can help you decide on this
• Family medical history

2. If you have any pre-existing medical conditions from the answers you provide, we will search the market on your behalf. Different insurers have varying attitudes to risk.

Some may feel that a medical condition is not important when it comes to what premium is offered. Others might charge extra as they view it as high risk.

In our award-winning Future Proof process, we contact insurers before submitting an application. We run a client’s medical details past an insurer’s underwriters anonymously. To get a clear understanding of what premium will be offered. Only then, do we suggest applying to the most sympathetic. This avoids wasting your time and any unnecessary nasty surprises.

3. You may be required to attend a private medical assessment ( paid for by the insurance provider) or, your GP may be contacted to provide a GP report. Future Proof will liaise with your GP to speed up this process. These will help an insurer better understand your medical condition.

4. Once your policy has started we help you to place your policy in Trust at no additional cost. Trusts are not regulated by the Financial Conduct Authority.

5. You keep up your monthly premiums and whenever you pass away the lump sum is paid to your loved ones.

Whole of life insurance covers the life of an individual. Whenever you die, the policy is guaranteed to pay out. ( as long as premiums are paid and up to date)

• A recap of personal information – which you must check is present and correct
• Your name
• Type of cover the quote is for
• Sum insured ( or monthly benefit)
• Term ( length of the policy)
• Full premium
• Any premium discounts – for example a multipolicy discount with one insurer
• Monthly premium payable

There are many benefits of a whole-of-life policy. These include:

1. Guaranteed payout of a lump sum, whenever you die.

This is different to a term life plan which will only run for a limited term eg to age 65 years. If you were to die after the term ends, your policy will have ended and you won’t have any cover.

2. The benefit amount can be used to:

• Cover your funeral costs
• Leave a lump sum gift
• Be used to help cover a potential IHT Liability*

*Upon death, Inheritance Tax Liability (IHT) is paid on any part of your estate that exceeds the ‘nil-rate band’. The ‘nil rate band’ threshold currently stands at £325,000 for an individual or £650,000 for a couple. The individual threshold can increase to £500,000 if you own your home (or have a share in it) and the home is left to your children or grandchildren. The current rate of Inheritance tax rate is 40% above these amounts.

The levels and bases of taxation and reliefs from taxation can change at any time and are dependent on individual circumstances.

3. A whole of life policy is medically underwritten, so premiums will usually be cheaper than taking out a guaranteed over 50’s plan, making it more cost-effective. As over 50’s plans do not ask any medical questions they accept more risk than a medically underwritten plan where the premiums offered take into account the person’s medical health. As such, the premiums are higher for Over 50’s plans.

4. Most whole-of-life policies can include an Index Linking Option which ensures the sum you are insured for keeps pace with inflation. This can be particularly important for clients looking for a policy to pay for funeral costs upon their death. Please note the monthly premium also increases as the sum assured increases so it’s important to ensure that including this option is affordable.

There are two drawbacks to a whole of life insurance policy:

• You have to be able to afford the monthly premiums and keep them up until you die. Be mindful of the type of policy you choose and whether it has reviewable rates that could rise during the policy or guaranteed rates where premiums remain the same as at outset.
• Being a medically underwritten policy, if you have any pre-existing medical conditions, you may not be offered cover by insurers, especially if they view your medical condition as being too high risk. Our advisers are experienced in finding cover for those with medical conditions. They will search the market on your behalf.

If you do not enjoy good health an alternative may be an over 50s plan.

Whole of life cover is right for you if you:

• Are in relatively good health and not obese
• Have not recently been diagnosed with a medical condition
• Can afford the monthly premiums 
• Want to leave a small gift to loved ones after you die

• Would like to leave a cash lump sum to your family to pay for your funeral
• Want to be able to be able to help cover a potential Inheritance tax liability*

*Upon death, Inheritance Tax Liability (IHT) is paid on any part of your estate that exceeds the ‘nil-rate band’. The ‘nil rate band’ threshold currently stands at £325,000 for an individual or £650,000 for a couple. The individual threshold can increase to £500,000 if you own your home (or have a share in it) and the home is left to your children or grandchildren. The current rate of Inheritance tax rate is 40% above these amounts.

The levels and bases of taxation and reliefs from taxation can change at any time and are dependent on individual circumstances.

When it comes to term life insurance and whole of life insurance, each has its merits.

Term life insurance will be cheaper than whole of life cover when it comes to comparing premiums. This is because you may not die during the term of the policy. If this is the case, the policy ends and there will be no payout. Insurers can offer cheaper premiums, as this is the risk that you take when you take out a term insurance policy.

With a whole of life policy, premiums are more expensive as the policy is guaranteed to pay out upon death, whenever that may be. Whole of life means that as long as you keep paying your monthly premiums, you will be covered, which offers many clients complete peace of mind.

We recommend speaking with your Future Proof adviser. They will compare both premiums. They will also discuss your health and contact insurers anonymously ahead of any application to gauge their response.

If an insurer is looking to charge extra based on ill health, whole of life may be out of the question when it comes to affordability. In which case, term life insurance may be your only option. In this situation, we can look into the best term of policy for you. Whether that be to age 70, 80 or 90 years.

Our advisers find cover every day for people with tricky medical conditions.

They will search the market so you don’t have to. Finding the most cost-effective, comprehensive cover by approaching the most sympathetic insurers. What is more, their advice is no-obligation. Take a look at the table below. It compares the difference between whole of life premiums with term insurance premiums of a policy that runs until age 90 years.

There are many providers that offer whole of life insurance. 

Each charge different rates and have different opinions on various medical conditions. It would be difficult for an individual to compare the small print of each whole of life insurance provider.

It should be noted that each individual is different. What might be the best insurer for one may not be for another. Our advisers will guide you through the small print, underwriting and premium comparisons to find you your ‘best’ insurer.

There is no maximum amount of cover you can get on a whole of life policy. However, a maximum amount of cover would depend on:

1. How much can you afford to each month in premiums?
2. Is there a justifiable reason for cover that accounts for the amount you are insuring?

Your whole of life cover is guaranteed to payout on the condition that you have kept up with all of the premiums. The whole of life premiums that Future Proof advise on, do not increase with age. They are guaranteed at the start of the policy.

It is important to be aware of what policy you have chosen and that you can afford the premiums as time passes. You must also have been truthful in your application and not left anything out that might be construed as non-disclosure. What is non- disclosure?

If you can afford the premiums you can take out multiple whole of life policies. We have had client’s who have taken out more than one policy to top-up a policy already in place. It is worth speaking with an adviser though, to check if it wouldn’t be more cost-effective to have one policy in place.

It is possible to take out a joint whole of life policy. It is important to remember though that this means there will only be one payout. You need to make sure that there will be no further need for cover for the remaining partner. 

You should bear in mind that it may not be possible for the surviving partner to get cover later in life. They may be over the maximum age of 88 years to be accepted.

As they will be older, the premiums will be more expensive, maybe prohibitively so. Or, they may have suffered medical issues since the policy was taken out leaving them declined by insurers.

Our advisers will advise you on the best course of action and whether a joint or single policy would be the best for your circumstances.

In the UK, a whole-of-life cover policy will last until the policyholder dies but only if your monthly premiums are kept up to date. This type of policy is designed to provide financial security for loved ones whenever the policyholder dies. Whole-of-life cover is a popular choice for people who want to ensure that their family is taken care of financially after they die. While the premiums can be expensive, the peace of mind that comes with knowing your loved ones will be taken care of can be worth the cost.

It is possible to get whole of life insurance without a medical. Your own medical circumstances and amount you would like to insure will dictate if this possible.

The maximum age restriction of getting whole of life cover is 88 years old depending on the insurer.

If you have a pre-existing medical condition, its type and severity will predetermine if you are able to get whole of life cover. 

An insurer may offer cover with a higher premium which is called a rating or loading. The higher premiums reflect the additional risk that your medical condition poses to your life. This may mean that they will have to pay out an early claim.

With a pre-existing condition, part of our process is to pick up the phone and call insurers to ask for their opinion before you apply.

We work with a range of well-known protection insurers, as well as specialist insurers that do not deal directly with the general public. Based on this outcome, we then help you apply to the most sympathetic and get you cover at an affordable price.

If you have many and serious pre-existing medical conditions, you may not be offered whole of life cover by insurers. In which case, Future Proof will then explore Guaranteed over 50s life cover as an alternative.

The whole of life premiums that Future Proof advise on, do not increase with age. They are guaranteed at the start of the policy.