In the earlier stages of a person’s life, life insurance and critical illness cover (often referred to as ‘accelerated life’) are essential for ensuring financial and family protection needs. However, once the mortgage is paid off, and the term life cover has expired, the protection gap for clients in the later stages of life is often left unaddressed.

AIG’s Whole of Life and Care Cover with Whole of Life products can be viewed as a potential solution to this problem.

While both products offer ‘whole of life’ life insurance (i.e. life insurance with no ‘end date’), each offer different solutions depending on your clients’ anticipated future needs.

Whole of Life can contribute to funeral costs and help your clients protect their assets. By placing their policy in trust, your clients could also offset a potential Inheritance Tax liability, as the policy should not form part of their estate, although there may be a potential IHT charge when the trust has a 10-year anniversary (known as a ‘periodic charge’) or when benefits are paid out of a trust (sometimes referred to as ‘exit charges’).

However, future developments could mean that your clients are forced to dispose of their assets in order to contribute to care costs – this could mean that they are unable to leave a legacy to their loved ones.

Care Cover with Whole of Life brings an added layer of protection, as it enables your customers to protect their assets in the form of whole of life cover or to receive an earlier payout if their mental or physical ability is diminished to the point of needing care.

Depending on their circumstances, and whether they have chosen a joint or single life policy, your clients will either receive a full payout (for death or terminal illness) or 75% of their sum assured if they meet the criteria for care cover benefit. Examples of how a Care Cover with Whole of Life policy would work in practice can be found here.

Together, AIG’s Whole of Life and Care Cover with Whole of Life products can help you bridge the later life protection gap, giving your clients peace of mind and confidence that their future needs will be met without requiring a loss of financial independence.

To find out how more about how these products could help your clients, call our Business Development Team on 0345 600 6829, email adviser@aiglife.co.uk