Money saving tips for life insurance could pocket you thousands
The economic climate may be tough, however, life insurance premiums needn't break the bank. By following a few easy steps moneysupermarket.com shows how you could save up to £4,732.Money saving tips:
Health improvements
People who opt for a healthier lifestyle will also see benefits on the cost of their life insurance. For example life insurance premiums for non-smokers are nearly half the cost than those for their smoking counterparts. It would cost £21.06 a month with LV= for a smoking male, compared to £10.42 a month for a non-smoker - a saving of £3,192 over the term. For women, a non-smoker with LV= would pay £2,376 less than a smoker over the term.
Consolidate your policies
Holding policies with several providers could cost more than necessary; a 35 year old male with life and critical illness cover, and income protection with a separate provider would cost £53.89. If consolidated to one provider you could save £1,540 over the term.
Emma Walker, head of protection at moneysupermarket.com, said: "In the current economic climate, people may be considering cancelling protection insurance policies to save money. However, this could be a false economy. Protection insurance cover should be seen as an important addition to your finances and, even more significantly, prevent you being hit by a huge bill should your circumstances change. If you unexpectedly fall ill or lose your job, having protection insurance in place could literally be a life saver."
Other tips to consider:
Changing circumstances
It is crucial to review policies following life changing events; moving job, having children, a change in marital status, increased debt or moving house may all affect the level and type of cover needed.
Cost - don't be fooled by cheap premiums
Don't always be lured by the cheapest premium; look at policy coverage and extras within the cover to make sure you are getting the cover you need and the best value for money. If a premium is too costly for your budget it is far better to get at least one policy rather than nothing at all; then review and add to it later.
Full disclosure is crucial
Make sure answers given when applying for your insurance policy are correct and include all relevant personal information and medical history - especially as a quarter of critical illness claims are rejected because of lack of disclosure3. For example, pre-existing medical conditions may not be covered for a specific period after the policy begins and failure to disclose a condition could lead to a subsequent claim being rejected. If in doubt disclose it; revealing your medial history doesn't automatically mean you will pay more.
Read the small print
Understanding the small print is crucial. When it comes to private medical insurance, details such as whether you will get outpatient care, or a choice of hospitals to receive your treatment will be covered in the small print.
Changing policies - seek advice
When replacing a policy, always seek advice and compare like for like. While a new premium may be cheaper, the cover might not be as comprehensive. Never cancel anything until the new cover is in place.
Emma Walker continued: "While buying protection insurance is essential for financial security and all-round peace of mind, it is important that you only opt for a level of cover relevant to your needs and at the best available price. People should also seek advice and understand the product they are purchasing. Even like for like policies vary in price and simply comparing the market will ensure you are getting the most for your money. Reviewing your protection policies on a regular basis is also important - not only will this ensure you are not paying over the odds but it will also make sure you're not under-insured."