While the rest of your purchases like food and fuel seem to be increasing in price on a monotonously regular basis there is an important product that is actually reducing in price for most potential buyers.
According to recent research by Sainsbury’s Finance life insurance premiums for 74% of customer profiles has dropped over the last year. This includes smokers whose premiums fell by 0.5% as well as non-smokers who saw a fall of 1%.
Their table of results shows that a market average premium in September 2006 was Â£16.11p. But that had fallen to Â£13.61p by December 2009 and then further to Â£13.52p in January this year.
Prices are being driven down by a combination of competition and better use of technology for administration and underwriting.
So, as things get tight instead of looking at cancelling these ‘lifebelt’ policies, see if you can shave off some of the cost.
The results also showed that the difference between the least and most competitive deals was a whopping 59%, although this is an improvement on 2006’s 65%. What this shows is how important it is to shop around for life cover and that you should review it regularly in just the same way that you review car and home insurance.
On the other hand some people get drawn in by the price of bargain basement life insurance but do not understand or are not told of the extras like free children’s cover that comes with some policies that they may be missing out on.
Also, bear in mind that you could either get the same cover cheaper, or more or better cover for the same price and one of those should be your aim.
Another reason to review your insurance needs is because of a change in circumstances such as divorce or separation.
With the EU outlawing gender based risk pricing for insurance in Dec 2012 it may be worth starting to look around now if you are in the market for a new life insurance policy or to review it.
You should talk to a broker who has at least a panel of insurers to choose from and ideally a whole of market provider who can do the shopping around for you and then will be able to recommend to you the most effective product for your needs.
When talking to you broker also discuss the benefits of placing your policy into trust, especially if you are married. You should also make sure that you will is up to date as, if you do not have one, the government via the courts could effectively write it for you.
For all you business owners out there you should also look at ‘Key Man’ and ‘Director’s’ insurances. Key Man cover would ensure that you have the funds to quickly hire a replacement and weather the financial repercussions should one of your key personnel pass away. Director’s cover would ensure that a surviving director could buy out the family of a deceased director. You can also include such things as critical illness cover as well.
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