Thursday, 19 March 2015
Life Insurance Money Saving Tips
Before you set off to buy life insurance always check that you are not already insured via another policy. For example if you are employed, you might be eligible for ‘death in service’ benefit, which typically pays out a lump sum if you die while still working for the company.
Compare life insurance premiums
You will find that life insurance premiums vary from one insurer to another, always shop around for the best price. But, remember that the cheapest may not always be the best – ensure the policy meets all your requirements. Seek professional advice if you are not sure.
Pick the right type of life insurance cover
There are two main types of life insurance cover – Term Insurance and Whole Life Assurance.
Term insurance is typically cheaper than whole of life cover as it pays out only if you die within the policy term. Whole of life cover lasts until you die, whenever that might be, and so is guaranteed to pay out.
Choose the correct period of insurance
Longer term policies tend to be more expensive as the longer the policy term the more likely you are to die and result in a claim. Pick a term that suits your needs.
Insure the right amount
The larger the claim amount is the larger your premium will be, pre-determine how much your loved ones will need after your death. Insure the correct amount and avoid paying larger premiums.
Buy when you’re young
This is an easy way to avoid paying large premiums, if you buy your policy when you are young you will benefit from lower premiums. You can save money by arranging cover in your 20s or 30s, rather than in your 40s and 50s.
It’s a bad habit and we all know how detrimental it is to your health. Smokers pay more for life insurance than non-smokers, so kicking the habit can be good for your wealth as well as your health.
Joint life insurance cover
Like with most things in life, when you buy two you are likely to get a discount and pay less for your premiums compared to 2 single policies. But remember most insurers pay out only on the first death. When the survivor dies, the family cannot lodge another claim