This is where life assurance and other protection policies come in. The policyholder pays a regular or single premium and in the event of the insured’s death, his or her family gets a cash amount, generally many times the amount paid in premiums.

However, there are also many refinements on basic life cover, which provides a guaranteed death benefit if a claim occurs during the period of insurance. Life assurance can be set up for a specified period of time (term assurance) or for the whole of the insured’s life (whole of life assurance). There are many other protection policies designed to protect the insured and his or her family against other life events, such as illness, accident, disablement, redundancy and long-term unemployment.

Simply having life assurance may not be enough. What, for instance, if you contract a near fatal disease or illness? Cancer, stroke and heart disease are the greatest risks. You may not be able to work and so lose your income; but you are still alive so your life assurance does not pay out. And to compound the problem, you may need expensive nursing care or to adapt your home, or even move house.

Permanent health insurance

Critical illness insurance

Loan protection insurance

Mortgage payment protection insurance

Accident Sickness and Unemployment (ASU)