In the event of your death, a life assurance cover can pay out. 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.
This will pay out in the event of death and can come in 2 forms: a lump sum payment or a family income benefit. A lump sum payment can be useful to pay off things such as a mortgage or other debts, or to leave a guaranteed amount of money behind to support your family. A family income benefit works differently in that it will pay a regular monthly income to your surviving family for the remainder of the policy. Both types of policy can run for any term necessary, but typical examples would be to the end of your mortgage, to the youngest child’s 21st birthday or until your anticipated retirement age.