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Save money on your life insurance premiums

Term Life preferred to Whole Life insurance
Protection specialists LifeSearch highlight five simple ways to save money on life cover premiums.
 
1 Shop around
2 Switch existing insurer
3 Act early
4 Quit Smoking
5 Consider Family Income Benefit (FIB)
 
Premiums are at their lowest levels for many years. Throughout 2007 the monthly cost of Life Insurance cover has continued to fall. Between March and September alone it fell by up to 10%. It means that now is a good time to buy.
However, it is important to remember that price should not be the only consideration when choosing a protection product and customers should look at the policy that offers the best value for money. This means looking at the product which most suits individual circumstances and offers additional benefits. However, there are still five very simple things you can do to save money on premiums.
 
1 – Shop around
An independent adviser can search the market whereas an agent tied to specific companies will only be able to sell a limited product range. Many people take out insurance with their bank or mortgage provider and this is often a mistake. They are usually very expensive products that do not offer the same level of cover that can be found on the wider market.
 
2 – Switch existing insurer
The cost of Life Cover has fallen by more than 40 per cent in the last five years, so it is possible that you could save money by shopping around. This is especially true if the original policy was not one of the cheapest on the market at the time it was bought.
 
3 – Act early
Premiums are more expensive the older you are when you take out the policy, so there really is no time like the present.
 
4 – Quit smoking
“Do you smoke?“ is one of the first questions that an insurer will ask a new client, as a smoker will pay considerably higher premiums than a non-smoker. For insurance purposes, you must have quit smoking for at least 12 months to be classified as a non-smoker. A cheaper premium is not certain, as it also depends on age and health, but there is a very good chance that the premium will fall.
 
5 – Consider FIB
Family Income Benefit works the same way as a life policy except that it pays out a regular income from the point of claim until the end of the policy, rather than a lump sum. You can get up to 80% more cover for the same premium by taking out FIB.
 
Matt Morris, LifeSearch Policy Adviser, says: “These are five very simple ways to save money on life insurance premiums. However, this is just a guide and you must remember that cheaper is not always better. Even so, if you can save money and still get the right type of cover for your circumstances, it makes sense to take advantage of the opportunity.”
Life insurance: News update: 16/11/07