Life Assurance/Insurance. A term applied to the insurance of persons’ lives where the contract is not one of indemnity but of an ultimate claim.
In the UK there are two types of life insurance:

(a) ordinary life assurance/insurance which means all life business that is not within the term industrial life assurance. Ordinary life business is supervised by the Department of Trade and Industry as long-term business (qv).
(b) Industrial life assurance is the business of effecting cover on human life where the premiums are collected at intervals of less then two calendar months.
This business may be conducted by friendly societies or authorised insurance companies. Industrial life assurance is regulated by the Industrial Assurance Act 1923.

The most common types of life insurance contracts are:

endowment (a fixed term policy with the sum insured payable on death or at the end for the term whichever occurs first);

whole life (sum insured payable only on death);

term (or temporary insurance) sum insured payable only if death occurs during the policy term; decreasing term as per term insurance except that the amount payable on death decreases each year; convertible term (a term insurance with the option to convert to whole life or endowment without evidence of health provided the option is exercised before expiry).

The permanent policies, i.e. whole life and endowment, may be ‘with profits’ (qv) or ‘without profits’.

Note: The terms assurance/insurance are interchangeable with the former being more traditional but there is now a tendency for greater use of the term insurance.

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