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Differences between LTA and DTA (Discuss)

Questions I often get asked is what are the similarities between level term insurance and decreasing term insurance and what are the differences.

They are both types of life assurance and they both payout a lump-sum if you were to die during the term of the policy. The main difference between the two is that level term insurance remains (as the title suggest) level so if you are insured for a £100,000 pounds for 20 years the policy would payout £100,000 pounds should you die at any time during the 20 years. 

The decreasing term insurance (as the name decreasing might suggest) decreases over time so if you started off with £100,000 pounds over 20 years with full cover on day 1, by the end of the term the policy that would be reduced down to zero.

The main usage for decreasing term insurance is to protect a payment of a repayment mortgage (capital and Interest). That is the type of mortgage where you pay some capital and some interest each month so by the end of the term you owe nothing. So your life insurance needs to mirror that repayment schedule of your mortgage loan.

One positive about decreasing term insurance is the premiums are lower because as you get older and your chance of dying gets higher the level of cover reduces so the premium is lower.

So, to recap, Level Term Assurance remains the same sum assured throughout the policy term and is generally used to provide life cover to pay a lump sum to your beneficiaries should you die (family insurance cover). Decreasing Term Assurance is generally used to cover a loan such as a mortgage. Level is more expensive than decreasing.

Oh, by the way both type of policies really need to be written in Trust. To know why please visit http://belcapinsurance.co.uk/uncategorized/life-assurance-trust/

Whole Life Plans for Funeral and Estate Planning

When most people think of traditional life insurance they think of term life insurance.

Term life insurance policy span a set number of years during which the insured party pays a fixed premium based on his or her age, current state of health and pay out an amount of the policy.

The alternative to this type of term life insurance is whole of life insurance (WOL). A whole of life insurance policy covers the insured party from the day of the policy begins until his or her death paying out a guaranteed sum of money to the policy holders beneficiaries. As such this type of WOL policy is often used for Funeral Plans and Estate Planning.

A portion of whole of life insurance premiums are invested by the insurer with any earnings intended to help offset the rise and costs of insuring the policy holder. Here at Belgravia Capital Insurance we recognize that making an informed life insurance decision requires having all of the available information and the ins and outs of whole of life insurance can seem complicated.

By breaking whole of life cover down to its basic components we hope to help you decide if whole of life is the right life insurance for you. We specialize in helping our clients find the right life insurance.

When you are ready to begin your search for the whole of life insurance that is right for you we are ready to help you find the perfect policy for your lifestyle and your family. In connection with our advised Whole of Life plans our clients can also enjoy a fantastic discount, from one of our partners,to produce a Last Will and Testament.For further info http://belcapinsurance.co.uk/rewards/