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Perhaps the two most essential types of insurance are life insurance and home insurance. Choosing life insurance can be a particularly overwhelming experience, so it’s important to equip yourself with the available knowledge before making a decision. For instance, you need to choose whether you’re going to invest in “protection-only” life insurance or “investment-type” life insurance.

Protection-only life insurance will cover you over a specified amount of time; however, if your death occurs after this designated period has passed, then your family won’t receive any payment.

Conversely, investment-type life insurance – also known as whole of life policies or endowment policies – will not only pay out in the event of your death, but will also accumulate in value during your lifetime. Hence, the younger you are when you choose to take out investment-type life insurance, the greater the value it will accrue during your life. Many personal pension schemes, including stakeholder schemes, may come under the umbrella of investment-type life insurance.