Home / Types of Life Insurance Policies
There are many different ways of describing the different types of companies which provide life insurance and life assurance policies. One of the main distinctions, which interests customers and prospective customers, is who owns the company.
Life Insurers can either be owned by those who hold shares in them (privately or publicly) or by those who hold policies with them (their customers), these are called Mutual Companies.
Policy holders with mutual life insurers often have what are called membership rights and benefits which can be varied but usually include voting rights when appointing Directors to run the company. It is important to point out however that is not always the case that having any policy with a mutual life insurer confers on the policy holder membership rights, this is because some mutual life insurers only offer such membership to those with certain types of insurance or assurance policies, or policies started before a certain date.
Whereas shareholders in a company can buy and sell their shares, members of a mutual life insurer can not unless of course the mutual votes to de-mutualise and in so doing issues shares to the members which can then be traded as other shares.
De-mutualisation has been a popular choice for a number of mutual life insurers over the years, leading to millions of life insurance and life assurance policy holders receiving shares which they can either keep, in the hope that the value of the shares grow and in the meantime earn dividends on them, or they can sell them. These shares are often described as ‘windfall’ shares because they have not been bought by the insurance or assurance policy holders who receive them.
The pressures on life insurance companies owned by shareholders (who demand increasing profits and therefore increased share values and dividends) are often very different to mutual life insurers which are owned by their customers; however the types of life insurance and life assurance policies offered by both types of insurers are broadly the same.
The possible windfall benefits offered by de-mutualisation have caused some to buy a life insurance or life assurance policy from mutual life insurers when their prices are at least as good as the alternative life insurers available, because of the chance of them receiving windfall shares.
At Direct Life we offer the life insurance products from mutual companies and those with shareholders.
03 July 2008 17:55:57
An outbreak of the bug Clostridium Difficile has led to a record number of pensioners in Scotland contracting the virus which could effect UK life insurance for those that have C Diff.
Figures showed that there were 1861 cases of C Diff among the over 65s between January and March of this year - a 14 per cent increase from a similar time period in 2007.
These figures are released following an outbreak at Vale of Leven Hospital in west Dunbartonshire, where nine people were killed and a further 50 were infected with the C Diff bug.
Health Secretary, Nicola Sturgeon, said that she had asked health boards to ensure systems for tackling hospital infections are being followed.
She said: "Scotland has one of the most comprehensive sets of policies and procedures to manage healthcare associated infection (HAI) in Europe.
"However, recent events at the Vale of Leven show how vital it is for boards to ensure that these policies and procedures are applied to a high standard."
Normal fatality rates for people that contract C Diff are at 7 per cent, however at Vale Leven this increased to 30 per cent - when taking into account the further 16 deaths directly linked to the outbreak.
Contracting a superbug may well effect patients life insurance policies.
03 July 2008 17:48:03
A government fertility watchdog has given the go-ahead for stem cell research that will be used to study fatal heart diseases.
Warwick Medical School researchers will use part-human and part-animal embryos for the first time to carry out their study which could eventually have an effect on the cost of life insurance policies for patients with heart disease.
The team plans to create embryos that are 99.9 per cent human DNA and 0.1 per cent pig DNA and stem cells extracted from the embryos will be grown into human heart cells.
Chemicals will be used to destroy the pig DNA before the researchers grow the human heart cells.
Justin St John, heading up the research team, explained what they hope to achieve from the process: "Ultimately they will help us understand where some of the problems associated with these diseases arise, and they could also provide models for the pharmaceutical industry to test new drugs."
Licenses have been granted to two other British teams that are hoping to create hybrid embryos but neither planned to extract animal DNA from the stem cells first.
Conditions such as heart disease can often have an impact on the cost of UK life insurance.
02 July 2008 17:03:39
A baby born with half a heart has just two weeks to live unless a donor can be found, doctors have told his parents.
Born with Hypoplastic Left Heart Syndrome, Theo Davies is currently on a life support machine which can only keep him alive for a short period of time, unless he has a transplant.
Talking about her desperation, Theo's mother Rebecca Giles, said: "People say 'Oh, it must be a nightmare for you'. But it's worse than that. I can't think of a worse situation to be in."
She continued: "Our child will die in two weeks unless we can find a heart donor. But to find another heart for Theo means that another child will die."
Theo has already had to endure five major operations since he was born and survived his heart stopping for an hour last week.
Surgeons in the US are about to undertake the first implantation of a Jarvik heart pump which, it is hoped, could help to solve a shortage of donor hearts.
One of the biggest difficulties facing people with heart problems is securing regular life insurance.
