Life Insurance?
Discussion
trickywoo said:
Isn't insurance a subset of assurance given assurance is in many ways (like for like) the superior product, at least for the person being covered?
By that I mean insurance will leave the policy holder with nothing if they live beyond the term while an assurance policy will still have a value if they live a (very) long life.
By that I mean insurance will leave the policy holder with nothing if they live beyond the term while an assurance policy will still have a value if they live a (very) long life.
Edited by sidicks on Friday 27th January 08:01
sidicks said:
Sarnie has explained this - you are still confusing what an 'assurance' policy is - a term assurance is very different from an endowment assurance which is quite different to an endowment...etc
I think we'll have to agree to disagree.But in the context of this post the following (well recognised definations) apply.
"Life Assurance has an investment value but Life Insurance does not.
Most people do not understand the important difference between Life Assurance and Life Insurance but it’s quite simple.
Life Insurance insures you for a specific period of time. Then if you die whilst the policy is in force, the insurance company pays the claim. However, if you survive to the end of the term, the policy is finished and has no residual value whatsoever. Even whilst the Life Insurance policy is in force it only has any value if you have a claim – in that context it’s just like your home insurance.
Life Assurance is different. With Life Assurance you have an important investment element. A Life Assurance policy joins a guaranteed insured sum with a none guaranteed investment, the value of the investment being directly related to the size of the guaranteed sum on your policy, the number of years the policy has been in force and Insurance Company’s investment performance.
If you were to die during a Life Assurance policy’s term, the policy pays out the guaranteed sum (just as with Life Insurance) or the value of the annual investment bonuses that had been added to the policy by the Insurance Company to date, whichever is the larger. Therefore, as the years go by the Life Assurance policy increases in value as the bonuses attached to it, build up.
However, if you survive to the end of the policy, your investment value is increased. You then get the annual bonuses plus a terminal bonus.
When a Life Assurance policy has earned an investment value via its annual bonuses, you can cash it in with the insurance company. However, most people get a far higher price for their policy by selling it to a specialist investment broker. You’ll find a number of investment brokers on the Internet who wish to buy life assurance policies."
As with lots of products like this 'professionals' in the field will dress up products and attach different descriptions to them, which is their right to do but in the context of this post OP is talking about life insurance not assurance. Both you and Sarnie seem to be arguing a point that isn't being discussed.
trickywoo said:
I think we'll have to agree to disagree.
But in the context of this post the following (well recognised definations) apply.
"Life Assurance has an investment value but Life Insurance does not.
Still wrong!But in the context of this post the following (well recognised definations) apply.
"Life Assurance has an investment value but Life Insurance does not.
The OP wants to purchase a policy that will pay out if he dies within a specific term - this is a term assurance product which is a type of life (insurance).
There is no ambiguity or argument here.
If the OP wants a product which will incorporate a savings element, so will pay out if he dies within a specified term or survives to the end of the term (e.g to repay an interest only mortgage) then he wants an endowment assurance product.
For simplicity, these all fall under the wider banner of life insurance.
trivckywoo said:
Most people do not understand the important difference between Life Assurance and Life Insurance but it’s quite simple.
Life Insurance insures you for a specific period of time. Then if you die whilst the policy is in force, the insurance company pays the claim. However, if you survive to the end of the term, the policy is finished and has no residual value whatsoever. Even whilst the Life Insurance policy is in force it only has any value if you have a claim – in that context it’s just like your home insurance.
Life Assurance is different. With Life Assurance you have an important investment element. A Life Assurance policy joins a guaranteed insured sum with a none guaranteed investment, the value of the investment being directly related to the size of the guaranteed sum on your policy, the number of years the policy has been in force and Insurance Company’s investment performance.
If you were to die during a Life Assurance policy’s term, the policy pays out the guaranteed sum (just as with Life Insurance) or the value of the annual investment bonuses that had been added to the policy by the Insurance Company to date, whichever is the larger. Therefore, as the years go by the Life Assurance policy increases in value as the bonuses attached to it, build up.
However, if you survive to the end of the policy, your investment value is increased. You then get the annual bonuses plus a terminal bonus.
When a Life Assurance policy has earned an investment value via its annual bonuses, you can cash it in with the insurance company. However, most people get a far higher price for their policy by selling it to a specialist investment broker. You’ll find a number of investment brokers on the Internet who wish to buy life assurance policies."
Highly misleading / wrong. Plus of course, few policies are available on a with-profit basis (which is what your googled definition is all about!!Life Insurance insures you for a specific period of time. Then if you die whilst the policy is in force, the insurance company pays the claim. However, if you survive to the end of the term, the policy is finished and has no residual value whatsoever. Even whilst the Life Insurance policy is in force it only has any value if you have a claim – in that context it’s just like your home insurance.
Life Assurance is different. With Life Assurance you have an important investment element. A Life Assurance policy joins a guaranteed insured sum with a none guaranteed investment, the value of the investment being directly related to the size of the guaranteed sum on your policy, the number of years the policy has been in force and Insurance Company’s investment performance.
If you were to die during a Life Assurance policy’s term, the policy pays out the guaranteed sum (just as with Life Insurance) or the value of the annual investment bonuses that had been added to the policy by the Insurance Company to date, whichever is the larger. Therefore, as the years go by the Life Assurance policy increases in value as the bonuses attached to it, build up.
However, if you survive to the end of the policy, your investment value is increased. You then get the annual bonuses plus a terminal bonus.
When a Life Assurance policy has earned an investment value via its annual bonuses, you can cash it in with the insurance company. However, most people get a far higher price for their policy by selling it to a specialist investment broker. You’ll find a number of investment brokers on the Internet who wish to buy life assurance policies."
Trickywoo said:
As with lots of products like this 'professionals' in the field will dress up products and attach different descriptions to them, which is their right to do but in the context of this post OP is talking about life insurance not assurance[/v]. Both you and Sarnie seem to be arguing a point that isn't being discussed.
"Professionals" will call things by their correct name, even if things are simplified for the underlying consumer!As with many topics on this forum, some people will use google and think they are an expert but demonstrate a lack of understanding,..
The OP wants a term assurance product.
HTH
Edited by sidicks on Friday 27th January 10:03
trickywoo said:
I think we'll have to agree to disagree.
But in the context of this post the following (well recognised definations) apply.
"Life Assurance has an investment value but Life Insurance does not.
Most people do not understand the important difference between Life Assurance and Life Insurance but it’s quite simple.
Life Insurance insures you for a specific period of time. Then if you die whilst the policy is in force, the insurance company pays the claim. However, if you survive to the end of the term, the policy is finished and has no residual value whatsoever. Even whilst the Life Insurance policy is in force it only has any value if you have a claim – in that context it’s just like your home insurance.
Life Assurance is different. With Life Assurance you have an important investment element. A Life Assurance policy joins a guaranteed insured sum with a none guaranteed investment, the value of the investment being directly related to the size of the guaranteed sum on your policy, the number of years the policy has been in force and Insurance Company’s investment performance.
If you were to die during a Life Assurance policy’s term, the policy pays out the guaranteed sum (just as with Life Insurance) or the value of the annual investment bonuses that had been added to the policy by the Insurance Company to date, whichever is the larger. Therefore, as the years go by the Life Assurance policy increases in value as the bonuses attached to it, build up.
However, if you survive to the end of the policy, your investment value is increased. You then get the annual bonuses plus a terminal bonus.
When a Life Assurance policy has earned an investment value via its annual bonuses, you can cash it in with the insurance company. However, most people get a far higher price for their policy by selling it to a specialist investment broker. You’ll find a number of investment brokers on the Internet who wish to buy life assurance policies."
As with lots of products like this 'professionals' in the field will dress up products and attach different descriptions to them, which is their right to do but in the context of this post OP is talking about life insurance not assurance. Both you and Sarnie seem to be arguing a point that isn't being discussed.
The OP isn't talking about a with profits product which you seem to be in the above.But in the context of this post the following (well recognised definations) apply.
"Life Assurance has an investment value but Life Insurance does not.
Most people do not understand the important difference between Life Assurance and Life Insurance but it’s quite simple.
Life Insurance insures you for a specific period of time. Then if you die whilst the policy is in force, the insurance company pays the claim. However, if you survive to the end of the term, the policy is finished and has no residual value whatsoever. Even whilst the Life Insurance policy is in force it only has any value if you have a claim – in that context it’s just like your home insurance.
Life Assurance is different. With Life Assurance you have an important investment element. A Life Assurance policy joins a guaranteed insured sum with a none guaranteed investment, the value of the investment being directly related to the size of the guaranteed sum on your policy, the number of years the policy has been in force and Insurance Company’s investment performance.
If you were to die during a Life Assurance policy’s term, the policy pays out the guaranteed sum (just as with Life Insurance) or the value of the annual investment bonuses that had been added to the policy by the Insurance Company to date, whichever is the larger. Therefore, as the years go by the Life Assurance policy increases in value as the bonuses attached to it, build up.
However, if you survive to the end of the policy, your investment value is increased. You then get the annual bonuses plus a terminal bonus.
When a Life Assurance policy has earned an investment value via its annual bonuses, you can cash it in with the insurance company. However, most people get a far higher price for their policy by selling it to a specialist investment broker. You’ll find a number of investment brokers on the Internet who wish to buy life assurance policies."
As with lots of products like this 'professionals' in the field will dress up products and attach different descriptions to them, which is their right to do but in the context of this post OP is talking about life insurance not assurance. Both you and Sarnie seem to be arguing a point that isn't being discussed.
No need for a term assurance to be with profit. They can have a fixed sum assured.
trickywoo said:
Not really. No. Fundamentally you are just using different terms to make something sound more complicated than it is.
I am using the correct terms to clarify your misunderstandings.If you want to use the wrong terms and false simplifications because it makes things simpler then that's your prerogative, but the 'experts' will keep correcting you!
Edited by sidicks on Friday 27th January 10:10
CarlosFandango11 said:
The OP isn't talking about a with profits product which you seem to be in the above.
No need for a term assurance to be with profit. They can have a fixed sum assured.
There are so many people not reading the thread here! You are agreeing with me.No need for a term assurance to be with profit. They can have a fixed sum assured.
This whole thing has gone way off topic and I apologise to OP for my part in it.
If you care to look back Coffin dodger corrected OP saying he wants assurance not insurance. I then corrected Coffin dodger saying insurance and assurance are two different things. Coffin dodger then said I was wrong.
Sarnie and Sidekicks then decided to get on a pedantic and patronising high horse of splitting hairs and definations.
I'm just standing my corner and saying life insurance and assurance are two different things, which this now bizzare agrument seems to have completely sidelined in talking about much more detailed aspects that don't have relevance to the broad definations of insurance and assurance.
trickywoo said:
There are so many people not reading the thread here! You are agreeing with me.
This whole thing has gone way off topic and I apologise to OP for my part in it.
If you care to look back Coffin dodger corrected OP saying he wants assurance not insurance. I then corrected Coffin dodger saying insurance and assurance are two different things. Coffin dodger then said I was wrong.
Sarnie and Sidekicks then decided to get on a pedantic and patronising high horse of splitting hairs and definations.
I'm just standing my corner and saying life insurance and assurance are two different things
And you're still wrong!This whole thing has gone way off topic and I apologise to OP for my part in it.
If you care to look back Coffin dodger corrected OP saying he wants assurance not insurance. I then corrected Coffin dodger saying insurance and assurance are two different things. Coffin dodger then said I was wrong.
Sarnie and Sidekicks then decided to get on a pedantic and patronising high horse of splitting hairs and definations.
I'm just standing my corner and saying life insurance and assurance are two different things
sidicks said:
I am using the correct terms to clarify your misunderstandings.
If you want to use the wrong terms and false simplifications because it makes things simpler then that's your prerogative, but the 'experts' will keep correcting you!
Go on then. Lets assume the OP is 30 years old and has a wife, mortgage and young family. He wants to cover the mortgage and provide for the children if he dies before 50 years old while paying the lowest monthly amount feasible. Does he want a life insurance policy or life assurance? Don't start with term assurance If you want to use the wrong terms and false simplifications because it makes things simpler then that's your prerogative, but the 'experts' will keep correcting you!
trickywoo said:
Go on then. Lets assume the OP is 30 years old and has a wife, mortgage and young family. He wants to cover the mortgage and provide for the children if he dies before 50 years old while paying the lowest monthly amount feasible. Does he want a life insurance policy or life assurance? Don't start with term assurance
He wants a term assurance product which is a form of life insurance. Potentially a decreasing term policy if he has a repayment mortgage.HTH
trickywoo said:
That really does. Thank you. Its life insurance he wants (even if you insist on calling it term assurance) 
That is what I was saying all along.
You mean "even if I insist on calling it by its correct name"?That is what I was saying all along.
He wants a term assurance which is a life assurance policy which is a form of insurance!
Edited by sidicks on Friday 27th January 10:25
sidicks said:
He wants a term assurance product which is a form of life insurance. Potentially a decreasing term policy if he has a repayment mortgage.
HTH
HTH
sidicks said:
You mean "even if I insist on calling it by its correct name"?
He wants a term assurance which is a life assurance policy which is a form of insurance!
In my view, term assurance is a form of life insurance and not life assurance.He wants a term assurance which is a life assurance policy which is a form of insurance!
Edited by sidicks on Friday 27th January 10:25
A term assurance policy is in force for a specified term, not until the policyholder's death, hence life insurance.
CarlosFandango11 said:
In my view, term assurance is a form of life insurance and not life assurance.
A term assurance policy is in force for a specified term, not until the policyholder's death, hence life insurance.
It's insurance of mortality risk and hence i believe 'assurance' is the correct terminology. That's why we have life assurance companies and life assurance actuaries but not life insurance actuaries etc!A term assurance policy is in force for a specified term, not until the policyholder's death, hence life insurance.
One of the dictionary definitions is:
Assurance: insurance, specifically life insurance.
Edited by sidicks on Friday 27th January 13:35
sidicks said:
It's insurance of mortality risk and hence 'assurance' is the correct terminology. That's why we have life assurance companies and life assurance actuaries but not life insurance actuaries etc!
Except you have to put the word term in front of it to give the distinction between an early death and a normal one.Your use of 'correct' is debatable as arguably the most commonly used description of term assurance is life insurance. You haven't yet properly explained how early death cover isn't insurance.
You seem to be basing your argument on an outdated nomenclature.
You may have to sit down for this but there are actual life insurnace actuaries http://www.theactuary.com/topics/life-insurance/
Edited by trickywoo on Friday 27th January 13:46
trickywoo said:
Except you have to put the word term in front of it to give the distinction between an early death and a normal one.
Eh?trickywoo said:
Your use of 'correct' is debatable as arguably the most commonly used description of term assurance is life insurance.
Correct is just a fact, regardless of 'common usage'. And a term assurance is life assurance which is a type of insurance.trickywoo said:
You haven't yet properly expalined how early death cover isn't insurance.
I've said no such thing.In this context (explained earlier) assurance is just a type of insurance that specifically refers to mortality risk.
trickywoo said:
You seem to be basing your argument on an outdated nomenclature.
I am basing my arguments on facts.trickywoo said:
You may have to sit down for this but there are actual life insurnace actuaries http://www.theactuary.com/topics/life-insurance/
Once again, using Google can't help you. The specific regulatory requirements refer to life assurance actuaries - to distinguish from general insurance actuaries. For simplicity, plenty of actuaries working in the insurance space would use 'insurance' rather than 'assurance', still perfectly correct, but there is no formal qualification of 'life insurance actuary'.Within the Actuaries' code there are specific requirements for:
- actuaries in non-life insurance
- life assurance actuaries
Nothing for life insurance actuaries though!
That's also why, for life assurance / insurance policies you have a sum assured not a sum insured
For simplicity, however, the profession often refers to Life Insurance companies and one of the professional exams is life 'insurance', not purely 'assurance' (which would be a subset of life insurance!).
Edited by sidicks on Friday 27th January 14:01
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