Banks offer insurance for homes, cars, travel, along with life insurance or life cover. In the US, banking and insurance were separated in the 1933 Glass-Steagall Act, but allowed to recombine following the repeal of the act in the late 1990s. In Europe, bancassurance – where banks work in partnership with insurance companies – is common.
Banks generally require mortgage customers to hold mortgage insurance, which will cover the amount of an outstanding mortgage in the event the mortgage holder dies.
A customer with life insurance will pay a regular premium to ensure that his or her death does not leave dependents in financial difficulties. Typically, life cover will pay out a lump sum to designated relatives to cover the outstanding debt on a mortgage, funeral costs, and other outstanding debts.