Take Your Life Insurance In to Your own Hands
The right life insurance is the basis for a solid financial life plan. A life insurance policy is not only meeting our emotional needs for security but also has many benefits besides. Here are some guidelines for getting your life insurance decision right first time.
Get to the facts! By yourself or with independent financial advice if you are at all unsure. There is a great deal of jargon and complexity around financial products. Look for plain English and place each quote side by side. Make a comparison table of all the aspects of the various policies. It is worthwhile taking your time to get the choice right.
Do you have some insurance already? Attached to your credit card you may find purchase insurance. Bank accounts often have holiday insurance rolled in. Your employer may do insurance benefits that you have neglected. Good company pension schemes will have a “death in service” provision, which can save you money. Of course an endowment mortgage also includes repayment of your mortgage in the event of death. Buying more cover than you need is the most common waste when it comes to life insurance.
Do it now! The cost of life cover, the premiums go up steeply as you get older and less healthy. If you smoke, stop now, it will save you money on your premiums, years on your life and cash in your pocket. You know it makes sense.
It’s nice to do everything together with your partner but you may pay more for life insurance as a pair. There is no BOGOF in this market. Check out the cost and benefits of separate policies. Don’t take up the first quote you get. Shop around and be prepared to haggle and compare ALL aspects of the various policies. Price comparison websites are a good place to start but they rarely tell the whole story.
Steer clear of the Arthur Daleys of life insurance. If they aren’t registered with the Financial Services Authority don’t touch them.Variable premiums should be avoided. Fix your payments for the whole life of the policy.
Honesty is the best policy (pun intended). Be sure to tell your chosen insurance company of all your health issues because if you don’t, it will invalidate any claims made and waste all of your premiums. If you visit your doctor during the period of approval for your policy you should inform the company. It may have no impact on your ultimate demise but it may invalidate any claim. Full disclosure is a condition of insurance taken most seriously by all companies.
Keep your last will and testament up to date, so that your wishes are met in the event of your death. Be sure to put your policy ‘in trust’ to avoid death duties for your beneficiaries.
More to it than you thought? It is a very important decision and the time and care you take at the start of the process will ensure that you get full value for your insurance policy as well as the peace of mind.
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