This is cover that pays out on death. Some plans pay upon earlier confirmation of a terminal illness where the prognosis is death within 12 months. It can pay out as a lump sum, or as income for the remainder of the policy term.
Cover can last for a set term called Term Assurance, or can last throughout life, Whole of Life. This payout is guaranteed.
The amount of cover can remain the same or increase / decrease annually. Level term assurance stays the same throughout. Decreasing cover is sometimes used to cover a reducing debt, such as a repayment mortgage.
