LTA vs DTA Leaflet (W13407) - Legal & General

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LEVEL TERM ASSURANCE DECREASING TERM ASSURANCE SUM ASSURED The sum assured remains the same throughout the term of the plan. Terms and conditions apply. The sum assured is calculated to match the maximum amount that would be outstanding during the coming month on a capital and interest mortgage being charged at an interest rate of 7%, 8%, 9% or 10%. PREMIUM Premiums likely to be more expensive than decreasing term. Premiums likely to be cheaper than level term. TERM The plan is designed to provide a constant level of cover over the term of the plan. This would make the plan suitable should your customer choose a mortgage product which allows them to raise their mortgage borrowing or to take payment holidays, providing the plan covers the maximum they can borrow on their mortgage. The plan provides cover to help pay off the mortgage amount owing, as this decreases throughout the term of the mortgage. EXAMPLE* In the event of a claim in year 15, the beneficiary would receive £100,000 from the plan, where they could, for example, pay £50,000 to the lender, leaving £50,000 for the surviving spouse/registered civil partner. In the event of a claim in year 15, the plan would pay out between £62,900 and £66,900 (this would be dependent on when the policy was taken out and when the claim was made). Again, £50,000 could be paid to the lender, and the surviving spouse/registered civil partner/beneficiary in trust would receive the remainder between £12,900 and £16,900. HOW THE PLAN WORKS • Plan aims to provide constant cover and may for a repayment mortgage pay more than the mortgage amount owing (as mortgage amount decreases) providing more for surviving spouse/registered civil partner/beneficiary in trust. • If your customer moves they can take the plan with them. Your customer may benefit from continuing to pay the same premium (premiums are based on age at outset). • Could be suitable to help protect future mortgages where the term is not extended and the amount borrowed does not exceed the sum assured. As the cover provided by this plan reduces approximately in line with the way a repayment mortgage decreases, it would not be suitable to help protect a future repayment mortgage where the amount borrowed is increased, or the term of the mortgage is extended. * Assuming a policy sum assured of £100,000 and a mortgage of £50,000 in year 15. Figures are an estimation only and based on an interest rate of 8%, and will vary depending on actual interest rates. Source: <strong>Legal</strong> & <strong>General</strong> as at 31 March 2014.
LEVEL AND DECREASING TERM PRODUCT DETAILS* PREMIUMS LEVEL BASIS DECREASING BASIS MINIMUM SUM ASSURED MAXIMUM SUM ASSURED JOINT LIFE BASIS Payable monthly or annually by Direct Debit. The sum assured selected at outset is designed to be the same if your customer dies at any time during the term of their plan. The sum assured selected at outset is designed to decrease approximately in line with the way a repayment mortgage decreases. None (subject to minimum premium). None (subject to underwriting and reinsurer approval). Joint life first death. LEVEL TERM Min: 1 year Max: 40 years DECREASING TERM DEATH BENEFITS ADDITIONAL BENEFITS SURRENDER VALUE NON-SMOKER RATES FLEXIBILITY COOLING OFF PERIOD OVERDUE PREMIUM Min: 5 years Max: 40 years The sum assured is payable if your customer dies during the term of the plan, or are diagnosed with a terminal illness and are eligible to claim. Some benefits are automatically included within our plans at no extra costs. These include accidental death benefit, terminal illness cover, Guaranteed Insurability Option. Free life cover and SmoothMove are included at no extra charge for Decreasing Term plans. These plans are not savings or investment products and have no cash value unless a valid claim is made. Yes – Discount for non-smoker. Your customer can make several changes to their plan throughout the term. These changes may affect the premium paid and may be subject to medical underwriting. 30 days from receipt of policy document. If the customer misses a premium payment the plan will only stay in force for 30 days from the premium due date after which the plan is cancelled and all cover will cease and may not be reinstated. * See Key Features document for more information.
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LTA vs DTA Leaflet (W13407) - Legal & General

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