Whole of life insurance is a very similar plan to term life insurance. It effectively pays out for the death of the person insured regardless of when it occurs no matter what age the life assured is. With term life insurance it covers you up until the term you have selected, for example 20 years. With this type of plan you select an amount of cover that you would like to be covered for and should something happen to you and cause your death throughout the course of your policy, the benefits of the plan will be paid out as a lump sum but the sum assured may be dependent on how much it will cost per month and whether you think it fits into your financial circumstance both now and in the future.
Regardless of how long you have this policy for, because it is insurance for the whole of your life eventually it will pay out its benefit. This means you could have had it for 1 year or even 50 years plus. The money could be used for funeral expenses, a gift or even to pay off any bills or debts that you may leave behind.
This type of insurance plan is normally more expensive than a standard form of term life insurance, purely and simply because you are paying for a guaranteed insurance pay out upon your death and it can effectively cover you for a long period of time.
When looking around for whole of life insurance you should be aware that there are different types of cover available on the market, so always ensure you know which one you want and double check the product you are buying. With most products you can choose whether you want it to be on a guaranteed premium or on a reviewable premium, and this would be your choice.
Whole of life policies can be written as a single life or joint life 1st death or joint life last survivor. Joint life last survivor is often considered for couples who might want to potentially mitigate possible inheritance tax liabilities (please be aware that if you have a joint life last survivor plan then no payment would be made on the death of the first life assured).
Generally speaking most people considering a whole of life insurance would normally wish to have their premiums on a guaranteed basis. The reason may be is that you then know exactly how much you are going to be paying throughout the contract, so that you can budget your monthly costs accordingly. It is also a good idea to always check if the type of policy can be placed in trust, as this would normally allow a quicker payment that may be able to be made outside of someone's estate rather than within which could actually increase the possibility of inheritance tax. All you would need to do is complete the correct trust documentation for your chosen plan and forward it onto the provider who would then action this trust for you.