The Difference between Life Insurance and Assurance

Many people think that Life Assurance and an online life insurance are the same things. However, this simply isn’t the case at all.

The Difference between Life Insurance and Assurance

Life insurance is a set amount of money that’s set aside for a certain person whenever the insured person dies. The insured person can also claim the money themselves if they live beyond a certain age. On the other hand, life assurance is a combination of insurance and an investment. Herein you’ll receive money that will be either equal to or more than the minimum amount that was underwritten by the policy’s clause or investment valuation. As such, your investment is actually reliant upon how the insurance company performs whenever it comes to investments and growth.

 

How this works is that every year the life insurance quotes company will add a bonus to the guaranteed value of your policy. There is also an additional bonus that you’ll receive at the end of the term, which is called a terminal bonus. So, as time goes by your policy will increase as investment bonuses continue to be added on to it. If you were to die during its term your beneficiary would receive either the guaranteed minimum sum or the annual investment bonuses’ accumulated value, whichever is actually higher (or more money).

 

To put this in even simpler terms, an insurance policy will cover the costs if something might happen to you while an assurance policy pays out if an event does happen. As such, an online life insurance policy is only going to last for a set amount of time and if the event occurs during that time, you’ll be paid, otherwise, you won’t be paid.

 

Benefits to Insurance Policies

One of the biggest reasons why people prefer life assurance over life insurance is that the cash is actually being invested, which means that it can make money for you. Of course, you don’t have any say in the investment portfolio as it’s left wholly in the hands of the insurance company. However, these are usually very conservative investments, meaning that you’ll probably earn less than if you were to do the investing yourself.

 

Receiving a Guaranteed Payout with a Life Assurance Policy

While an online life insurance policy won’t always pay out, a life assurance policy will generally pay out whenever you are 65-years-old or upon your death. This will help to guarantee that your family will not only be able to pay for your funeral but that they will also have some form of financial support available when needed. Payments are made every year upon the investment portion after the person turns 65. Until then the premium is invested upon your behalf. Clearly you can now see why these aren’t just used for insurance but also as a retirement savings account as well.

 

For Those Who Are In Need Of Money Now

Anyone who wants to cash in upon the investment portion of their life assurance policy before the time actually comes for them to do so will find that it’s something that they really can do. Unfortunately, they will be faced with really heavy penalties though. For this reason, it isn’t advisable for you to cash in early on your policy unless you really, truly need to do so.

 

Conclusion

 

Today the difference between the two types of policies are actually becoming more and more blurred. This is because both of them are being offered by a lot of different companies who are also adding additional features of one policy to another policy in order to make these policies look a lot more attractive. Of course, it’s still important for you, as a customer, to know what the differences are so that you will be able to ask for the right thing and so as to make sure that you are properly prepared for whatever the future may bring.

 

Hopefully this information will help to clear up things in regards to life assurance and online life insurance for you. This way you’ll know for sure which of them would be a better fit for you and what you are in need of. Only then will you be truly prepared for when you get older and are, unfortunately, nearing the end of your time here.

http://www.nidirect.gov.uk/office-of-fair-trading

 

What You Need To Know About Debt Management Plans

Anyone who is caught up in debts can use SimpleFS Debt Management plans to eliminate his problems. If you are one of those people that have been struggling to pay your debts, you should consider using a suitable plan that will assist you to clear all the money you owe other people. These are plans that a credit counsellor puts in place to help you pay all your debt within a reasonable time.

 

How They Work

Debt management plans are offered by a number of financial institutions and debt counsellors countrywide. The kind of plan that will apply in one’s situation ultimately depends on the circumstances surrounding the debts one owes. What your adviser will do is to conduct a thorough assessment of these circumstances including your personal income, any other income and expenses, all the assets you own and the total amount of debt you owe your creditors.

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Chris Florence @ Flickr

 

Your adviser will then use the results obtained from the assessment to make a clear plan of how your debts should be managed. This plan should be practicable and suit your particular circumstance. These plans may include some form of strict measures such as cutting back on the amount of money one spends on a monthly basis, doing away with items and programs that are not essential and cutting down on any luxury expenses you may have.

 

Once a practicable plan has been agreed upon, it is often advisable to have the agreement in written form and signed. This will ensure that creditors agreed to consolidate their debts and receive monthly payments to pay off the debt owed to them. You can also choose to negotiate with your creditors and create a voluntary plan that will allow you to pay off your creditors within a specific period and in instalments.

 

The Pros

When your creditors see that you are taking a positive step towards repayment of your debts, then you will be in a position to negotiate with them. The good thing about debt management plans is the fact that your monthly payments do not increase. The only time that you may actually need to worry about payment increase is when your debt counselling company sends the payment late or skips it. Otherwise, you will not need to worry about payment increases.

 

People often acquire their debts mostly through credit cards. So, once you enter into a debt management plan, be certain that your credit card accounts will have to be closed. You must stay away from credit cards for as long as you are paying your debts.

 

Another great thing about having a debt payment plan is that you will not be inconvenienced by multiple monthly bills that always come at the same time every month. Your debt counsellor will be sending your payments automatically when the time comes. And perhaps, your creditors will not be charging you a higher interest once you choose to use debt management.

 

The Cons

Debt management plans are not always the best options for everyone. Each individual has their own unique cases that can be handled differently. This is because; such plans can have quite adverse effects on the debtor. What you need to understand is that most of these arrangements come with very stringent measures that not everyone can entertain.

 

Furthermore, such arrangements can have a negative effect on your credit. It will definitely make it a little harder for you to qualify for new credit. This is because, every time you use an arrangement such as this one, a comment has to be added that you are using the aid of an agency to pay off your debt. This might not affect your credit score but it will definitely injure your reputation with your creditors.

 

How They Can Help You Get Out Of Debt

Essentially, such arrangements are meant to assist people with debts to pay them off before their creditors can take legal actions against them. So, this arrangement will technically help you know how much money you owe your creditors. You will be able to create a realistic budget and rearrange your finances while getting financial advice from your debt counsellor. This ultimately help your to keep out of debt once you are done repaying the current ones. It can be quite successful if all the terms of the agreement are followed.