If you work in a potentially life-threatening occupation, you may have already considered taking out a life insurance policy to protect your loved ones in case the worst happens to you.
However, you may have found it difficult to find cover for your circumstances, due to the increased level of risk your job incurs.
Death in Service Life Insurance, therefore, is a specialist insurance product designed to help people who work in a range of dangerous occupations.
Find out more about how this insurance works and what you should consider before finding a suitable policy for your needs.
This cover is often added to an employee’s benefits package when they start at a new company. For employers looking to insure their staff in this manner, you would be looking at Group Life Insurance policies. This insurance is designed to pay out a lump-sum to an employee’s family in the event of their death whilst performing their job role. This makes it a similar product to life insurance, only the cover lasts just for as long as the employee is working within a role. Therefore, if an employee were to retire, or leave the company, the family would no longer be eligible for a lump sum payout upon death.
The amount of cover employees can claim for varies but may be a multiple of their normal salary (say, from three to five times).
Under an employer’s agreement, they would pay towards their staff’s premiums every month and decide their level of cover. If the employee then wanted additional cover, they could choose to seek out their own policy. When taking out a policy, each employee would fill out a medical information questionnaire. Premiums will then be worked out by underwriters to determine the levels of cover for employees. As with an individual premium calculation, the younger and healthier you are, the less you may pay towards your insurance premiums. It is also possible that some employees may have to undergo a medical examination to join the group policy.
Jonas started working as an installation technician for a travelling theatre company. In his employment package, he was offered Death in Service cover for three times his annual salary. This would be £150,000 to his family as a tax-free lump-sum, if he were to die during his employment there.
As he needs more than that to cover the amount left outstanding on his mortgage loan, Jonas looks to buying an additional life insurance policy for himself. Covering himself for the additional funds worked out cheaper for him than seeking out a single policy to cover his entire mortgage and other debt commitments, in the event of his death.
If you would like to find out more about Group Life Insurance and how it may benefit your employees, get in touch with an insurance broker. They can offer you a free, no-obligation quote and advice for employers.
I needed life insurance and critical illness for myself and my wife. I got a number of quotes from some of the big brands and was very happy with the final price. Mike Davidson, Birmingham
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* Life insurance from 20p per day is an illustrative figure only and may not be available to you. The figure is based off of a 25 year old non smoking female taking out £150,000 of term assurance over 25 years on a level term basis and available from Beagle Street. Figure accurate as of 19/03/2015.
* Life insurance & Critical Illness from 35p per day is an illustrative figure only and may not be available to you. The figure is based off of a 25 year old non smoking female taking out £150,000 of term assurance over 25 years on a level term basis along with £50,000 of critical illness cover and is available from Beagle Street. Figure accurate as of 19/08/2015.
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