If your employer has no group life scheme — or you leave the job that had one — there is nothing behind your income at all. A whole of life policy fixes that, and it does not expire. This shows what the payout would be worth if your family invested it rather than spending it.
The returns shown below are net of withholding tax and are illustrations of what these funds have tended to deliver, not forecasts and not guarantees. Real returns move every year and can fall. Change any rate to a figure you would rather use.
The same money, placed in three different funds. Each figure below is what the benefit would pay out, without touching the capital itself.
This is the number that matters. Not what the payout is, but what share of your monthly income it would actually replace.
This is what separates a lump sum that gets spent from one that keeps working.
Two things people assume are covered, and usually are not.
Group life belongs to the employer, not to you. It ends the day the job does — resignation, redundancy, retirement, or a company that stops renewing. The cover you were counting on is gone at exactly the age when replacing it costs the most. Plenty of employers have no scheme at all.
Term cover expires. It runs to a set age and then stops, and most people outlive it. You pay for thirty years and leave nothing behind. Whole of life does not expire, so the payout is a matter of when rather than if — which is what makes the figures above worth planning around.
Inflation. An income that never rises buys less every year. In ten years, the same monthly figure will not go as far as it does today.
Returns move. A fund that paid well last year may not next year. Equity funds in particular rise and fall, and a bad year means a smaller cheque that month.
Spending the capital. The moment the family draws down the principal, the monthly income starts shrinking and does not recover. That is the conversation worth having before the money ever arrives, not after.
This is an illustration, not a quote or a promise. Benefit amounts depend on underwriting, the sum assured actually taken and the policy terms. Fund returns are historical illustrations net of withholding tax, are not guaranteed, and can fall as well as rise. Past performance decides nothing about the future. Nothing here takes account of your own circumstances. Always confirm a fund is CMA-licensed and read the policy document before acting.