ABOUT Family Income Benefit
Family income benefit is a special type of life insurance policy that pays out a regular tax-free income for a set period for the family of the policy holder after their death. For instance, if a policy holder takes out a 20-year term policy and a claim is made 10 years into the policy, there will be a pay-out of 10-year.
Who is Family Income Benefit For?
- The policy is suitable for couples with young families or have older financially dependent children. A single person with no financial dependents who would like to provide an additional financial security for their parents in their later life may also consider the policy.
How does Family Income Benefit Work?
- We will review your current income and expenditure now and assess your income requirements for the future. We will then recommend an annual sum assured; this is the amount the policy will pay out each year for the remainder of the term.
Keeping Pace with Inflation
- If you need a Family Income Benefit Policy that will pay your financial dependants £5,000 a month in today’s money and your family made a claim 20 years later, the £5,000 may not be enough due to inflation? You can index link your policy and premiums, from the outset. You can link the sum assured to the Retail Price Index, so as inflation increases, the sum assured increases, and this guarantees that your policy retains its value. Note also that your premiums too will increase.
Can My Dependants choose to take a Capital Sum?
- Yes, if your dependents decide that a capital sum would be better than receiving a monthly income, they can request that the policy is changed after your death.
Are the monthly premiums more expensive?
- Compared to Level Term Assurance and Mortgage Life Assurance, the monthly premiums for Family Income Benefit are generally less expensive.