If your business is adversely affected due to the death or critical illness of a key person such as a director, it may struggle to maintain the repayments on its debts. A Decreasing Term Assurance policy is designed to help your business pay off the outstanding balance on decreasing debt in the event of the death or diagnosis of a specified critical illness of the key person during the plan term. The benefit is payable as a lump sum. The amount of cover will decrease broadly in line with the amount outstanding on the business’s borrowing.
Risk Factors
It is vital that all the questions on the application are answered fully, truthfully and accurately and that the life insured tells us about their medical history in full. Failure to mention something could result in the policy being inappropriate for your business protection needs and may invalidate any future claim made.
If premiums aren't paid, the policy and cover will end 30 days after the last premium was due and you will get nothing back.
If critical illness cover is chosen, Aviva will only pay out if the life insured is diagnosed with a critical illness that meets the plan definitions and then survives for at least 14 days.
This policy has no cash-in value at any time.
Inflation may reduce the value of the cover.
Key Features
- Provides a lump sum to help repay the balance on business loans in the event of the death of the life insured
- Provides the option to include critical illness cover within the plan
- Offers the facility to protect premiums if the life insured is unable to work due to accident or illness
- Terminal illness cover before the last 18 months of the plan
- The life insured must be aged between 16 and 66 at the start of the plan but it cannot run beyond their 76th birthday (other age restrictions will apply depending on the options selected)
- The life insured must be a UK resident at the time the cover is taken
- Premiums can be paid monthly (minimum £5) by direct debit or yearly (minimum £50) by cheque or direct debit.
If you would like to know more about the risk factors and key features of Decreasing Term Assurance, please contact your local branch to speak with a Financial Planner.
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