Cheap Life Insurance

Are you one of the millions of Brits who don’t have life insurance? Or, if you do, are you paying too much for your policy? A 2006 survey by Abbey found that approximately 30% of people surveyed said they couldn’t afford life insurance. (News BBC) Many people believe that life insurance is very expensive, but it doesn’t need to be.

Is cheap life insurance available?

In most cases, yes. Most people can find life insurance at competitive rates as long as they are willing to invest a little time in researching and comparing policies. Too many people get only one quote or take the first policy they find, which can cost you quite a bit more in the long run.

More than 50% of UK homeowners buy mortgage life insurance from their banks or mortgage provides without ever checking into other providers. This costs homeowners approximately ₤600 million annually.(Finance Daily)

The UK has the largest life insurance industry in Europe with plenty of companies to choose from and a wide range of policies and prices. A survey by Sainsbury’s Bank found that prices can vary by over 60% among providers. (Channel 4) So shop around and compare all your options before you buy.

What is the cheapest form of life insurance?

This would be term insurance, which insures your life for a particular period of time, or term. This is by far the most common type of life insurance and it can be found very reasonably in most cases. Actually, life insurance prices have come down in recent years. In some cases the cost has decreased by 40% since 5 years ago. (Nations Finance)

If you are in good health and a non-smoker, you should be able to find life insurance very reasonably. For example, a 35-year old male non-smoker can get a ₤100,000 Life Insurance term 20-year policy for less than ₤8 a month. (Insurance Sorter)

How can I find cheap life insurance?

There are a number of financial service websites such as Moneyextra, Moneynet and Moneysorter that allow you to compare insurance plans and prices online. You fill out a simple online form and they will provide you with several quotes. You can also visit individual insurance companies online such as AXA, Prudential and many others and obtain an instant quote.

You can also check with an insurance broker such as Endsleigh or Charcol who handle policies from many companies. Or, if you are unsure about what type of policy you need, you may want to check with an Independent Financial Advisor, who can work up the best options for your particular situation.

What can I do to lower the cost of my life insurance?

Insurance companies calculate the costs of policies based on risk. Therefore, if you are considered a high-risk customer, you will pay a higher rate for your policy. If you want to lower your rate, you may want to consider lowering the risk factors in your life. Lifestyle is now one of the major factors looked at by insurance providers, and lifestyle can include items such as smoking, drinking and obesity as well as hazardous jobs, dangerous hobbies or previous medical issues.

The biggest single thing you could do to reduce the cost of life insurance is to stop smoking. Smokers pay up to 60% more for life insurance than non-smokers. (Compare the Market)

Other measures that can help reduce your risks are losing weight and exercising regularly. A spokesperson for the Association of British Insurers notes “Insurers have a role to play in encouraging people to adopt a healthy lifestyle…” (Best Deal Insurance) And some companies give discounts to customers with a healthy lifestyle, such as Animal Friends who provide discount life insurance to vegetarians. (Money Marketing)

Another thing you can do, if you already have a life insurance policy, is to review it from time to time and see if it still meets your needs or if you could find equivalent cover elsewhere for a cheaper price. Approximately 1/3 of people with life insurance policies haven’t reviewed them in the past 5 years and could be paying more than they need to.(MSN Money UK)

Is cheap life insurance right for you?

While we all want to save money when possible, it may not be the best decision to buy the cheapest policy you can find online. While most insurance companies are highly reputable, it always pays to check them out a bit first and be sure to read all the fine print. Some cheap policies may have exclusions or limitations.

Matt Morris, policy advisor at Lifesearch, notes “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.” (Nations Finance)