Life assurance ensures that in the event of a specified persons death, a benefit is paid to a nominated person(s). This provides beneficiaries with money in the form of either a lump sum or an income on death, whenever that may occur, to allow life to continue without suffering any material disadvantage.

Life assurance policies can be written for a specified time period or for the whole of a person's life. They come in various guises to suit the differing needs of people in today's society.

One popular use of Life Assurance policies is to combat any Inheritance Tax Liability which is payable on the estate of a person who has died, if the value is over £242,000 (2001/2002). The tax liability is 40% of everything above this figure, normally paid out of the estate.

This liability can be mitigated by using a life assurance policy placed in trust. This places the benefits outside of the estate, thus reducing the inheritance tax liability of the estate.