National Friendly Guaranteed Life Assurance Plan
National Friendly has launched a new guaranteed acceptance life insurance product for those aged between 50 and 80.
The new whole of life policy pays out a guaranteed cash lump sum on death at any time to help pay for funeral costs, pay off outstanding debts or to simply to leave behind a cash legacy for loved ones.
The policy can also be put in trust so beneficiaries receive a tax free lump sum.
Premiums start from £20 a month, and go up to £100 a month, and remain the same for the duration of the policy. Customers decide what sum insured or premium they want to pay each month, and all applicants are guaranteed acceptance, irrespective of medical history. There is no cash-in value at any time. On death within the first two years not following an accident, the policy pays out 150% of the premiums paid to date, with the full sum insured payable after two years regardless of cause of death.
Comment: This policy follows the now well-trodden path of guaranteed acceptance to help cover funeral costs, with premiums guaranteed throughout too. Such policies can prove expensive over time, especially as premiums on this policy are payable throughout life rather than limited to say age 90.
For those who don’t expect to live for two years, the plan can still make sense, as the return on premiums paid is substantially more than can be achieved through conventional savings. All that would be lost though if they survive two years and then discontinue the policy. In any event the sums involved are small so the risk of customers doing this is small.
National Friendly is quite innovative, but this product offers little that is not available elsewhere.
Plus points: Simple guaranteed whole life cover; Guaranteed acceptance; Can be written in trust; Small end of life investment option.
Not so plus points: Can prove expensive over time; Premiums are payable until death, with no cashback if the plan is stopped before then.
Website: http://www.nationalfriendly.co.uk
Rating (max 10): Innovation: 6. Overall: 6. Bronze
Tags: WL; National Friendly