Family income benefit policies run in terms, which is a chosen period of time that is specified by you. If you pass away within this period, your family will receive regular payouts until the term ends.

A sudden death can make it difficult for your loved ones to manage, especially if they are largely dependant on you for providing a steady income. This benefit will ensure that they receive regular payments, mimicking that of your financial support.

If you have young children, for example, you might want to set up a policy that runs until the children are likely to be more financially dependant. This way if you pass away during their childhood, the expenses can be used to cover school costs or university fees for example.

Although family income benefit is a type of life insurance, there are major differences between the two. While life insurance pays out a lump sum of money after your death, family income benefit is given in the form of monthly payments to provide a steady income.

A premium is the amount of money that you pay each month towards your cover. The amount of a fixed premium will stay the same every month until your policy ends whereas a reviewable premium can be changed by the policyholder if they wish to for reasons such as current age or health.

No, you will not get your money back – it works in the same way as any other type of insurance such as car and pet insurance.

Family Income Benefit is a type of Life Insurance, so it pays cash if you die. But unlike traditional policies which normally pay a lump sum, Family Income Benefit pays a monthly income. This has two big advantages:

A lump sum big enough to provide for a young family’s future is likely to be very expensive to buy – a Family Income Benefit policy that provides an equivalent income is likely to be much, much cheaper.

Managing a lump sum pay-out to provide an income is a hassle. It requires complicated investment decisions and often incurs fees, commission and tax. Family Income Benefit avoids all that.

If someone dies halfway through the term of a FIB policy, the number of monthly payments is half the maximum, whereas traditional Life Insurance makes the maximum pay-out whenever someone dies. However, while the cost to the insurer is less, the difference to the insured might only be marginal if they’re looking for their cover to provide an income.

They’re two very different policies with very similar names. Family Income Benefit pays beneficiaries after the insured person dies, whereas Income Protection protects an insured person’s income if they’re unable to earn due to illness or accident (but are still alive).

It’s usually a good idea to get a policy that will keep track of rising prices, especially if there’s a chance it’ll be paying out over a long period of time. We’ll compare policies that maintain their buying power and those that don’t, and help you choose the one that best suits you.

No. Family Income Benefit is designed to protect your family if you die, so your family won’t need protecting if you don’t die. (In the same way, car insurance won’t pay out if you don’t have an accident and pet insurance doesn’t pay if your pet stays well).