Term assurance (or "temporary assurance") gives you financial protection if you die within a specified period known as "the term". This period might be 5, 10, 15 or 20 years although you can arrange policies to cover you for periods as short as one month. If you are alive at the end of the term no payment is made and there is no surrender value - meaning that if you stop paying the premiums the cover ceases and there is no refund of premiums paid. People on a limited income may find that term assurance is most appropriate. The term (period of cover) can be chosen to cover the length of your mortgage, or cover the period when children are growing up and expenses are at their highest. Some families find a regular income more useful than a lump sum. For them a 'Family Income Benefit' policy could be more appropriate and cost effective.

Historically popular in funding repayment of 'interest only' mortgages, the purpose of an endowment policy is to provide a lump sum death benefit plus a lump sum at maturity, which is a pre-selected date in the future. These plans have become less popular in recent years as people have chosen to fund for lump sums and death benefits with different plans which might be more tax effective.