50 + Life Cover - Frequently Asked Questions
What type of policy is 50+ Life Cover?
The policy is "Whole of Life" insurance - which means your cover lasts for as long as you pay the premiums - with a minimum payment guaranteed when you die. If you stop paying your premiums, your cover ceases.
Will the payout be liable to tax?
The death benefit is paid out free of Income Tax at the basic rate and Capital Gains Tax - but may be liable to Inheritance Tax unless the policy is written in trust.
How much will my premiums and level of cover be?
Monthly premiums range from £10 to £100 and your level of cover will depend on a number of things - such as your age, gender and the monthly premium you choose to pay. See what cover you can get for your monthly premium.
Will the premiums remain the same - or could they increase?
Your premiums are fixed - so they will stay the same.
Is the payout guaranteed?
We guarantee to make a lump sum payment of at least the basic sum assured upon death after the policy has been going for two years (or in the case of accidental death during the first two years) as long as you continue to pay your premiums.
Why do I stop paying premiums at 90 years old?
You stop paying premiums at age 90 to reduce the possibility of over-paying into the policy. When your premiums cease at age 90, your basic sum assured and any bonuses added will remain in place and will continue to be paid out on your death. Your entitlement to future bonuses will continue beyond age 90 even though you have stopped paying premiums to aim to increase the final cash sum paid to your dependents.
The addition of bonuses is not guaranteed and will depend on the performance of our With Profits Fund and how we decide to distribute any profit. For more detailed information on how we manage the fund see ' How you share in the profits of Foresters Friendly Society'.
What happens if I stop paying my premiums before I reach 90?
If you stop paying premiums before you reach 90 your life cover will cease immediately. During the first two years your policy will have no cash-in value. After this time you can cash-in your policy, but the value of it may not be as much as you have paid in.
How does the money in a With Profits Fund grow?
The Foresters 50+ Life Cover Plan is a with profits policy which is intended to provide a death benefit. It is not a savings plan. However, every year bonuses are intended to be added to the basic sum assured - with the possible addition of a final bonus being paid after you die. Once bonuses are added they cannot be taken away and will increase any cash-in value. Bonuses are not guaranteed and will depend on the performance of the With Profits Fund and how Foresters Friendly Society decide to distribute any profit. For more detailed information about how we manage the fund, see ' How you share in the profits of Foresters'.
Why does the cost of life cover differ between men and women?
There are several factors that go into working out how much to charge for life cover, one of them is related to mortality rates. On average women are expected to live longer than men, this has an effect on the relative risk associated with covering women as opposed to men, which is reflected in the premiums they pay.
The Sex Discrimination (Amendment of Legislation) Regulations 2008 specify the circumstances in which insurance companies can charge different premiums or offer different benefits to men and women under individual insurance and pension contracts.
The regulations permit insurance companies to charge different premiums provided that the data relevant to the use of gender as a risk factor is compiled, published and regularly updated in accordance with guidance issued by the Treasury. Where we use gender differentials in setting our premiums we base these on data provided by the CMI (Continuous Mortality Investigation).
In March 2011, this regulation was reviewed by the EU courts and from 21 December 2012 insurance companies will no longer be able to differentiate premiums based on gender. Our 50+ Life Cover policy will be updated from this date to reflect the change in legislation.
I'm not sure if the 50+ Life Cover policy is right for me. What should I do?
If you are unsure as to the suitability of this product you should seek advice from an Independent Financial Adviser. You may have to pay for this advice.
