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How to Buy the Right Life Insurance Policy

How to Buy the Right Life Insurance Policy

When it comes to choosing life insurance, online comparison tables can be a great place to start, but it's also good to speak with a specialist. They take the hassle out of comparing individual life insurance policies - and can point you towards the right life insurance cover for your circumstances.

Pick up the phone

If you really want the best deal - tailored to your individual needs - then you can't beat picking up the phone and talking to an independent life insurance broker. They'll have access to the most up to date rates, as well as some life insurance policies that are only available through intermediaries. What's more, as brokers are in competition with each other, this effectively drives prices down. So they'll provide a competitive quote in a matter of minutes - and at no cost (as they collect their charges from the insurer).

Get the right fit

Life insurance isn't a one-size-fits-all product. What's right for one person might not be right for you, so make sure you have the best life insurance cover for your circumstances. Don't just accept generic policy accounts and terms - talk to a broker who will tailor your cover to you.

Don't be shy

Once a broker has given you a life insurance quote, in many cases, you can make even bigger savings if you ask them to go lower. Often, they will take a cut to their commission, just to win your business. And you won't lose anything even if they don't lower the cost. So go on. Nothing ventured, nothing gained.

Trust a trust

Spend a minute arranging for your life insurance policy to be written in trust - and you could save loads of time in the long run. If your policy is not written in trust, there could be a delay in making the money available to your loved ones when the policyholder dies - and the sum could also be subject to the dreaded inheritance tax. So put your foot down, and insist that your policy is written in trust. It won't cost you a penny, but it could save you a packet.

Do it young

When you're young, life insurance is probably the last thing on your mind. But getting in early can save you big. Premiums increase with age, so younger people generally benefit from life insurance cover at a much lower price. And, should you develop a medical condition at a later date, it means you'll still be covered.

Review your options

Life happens. Circumstances change. So what's right for you now, might not be right for you in the future. With this in mind, it's a good idea to review your life insurance coverage every year or so. This way, you can increase or amend your cover as and when you need it. This ensures that, if the worst does happen, your loved ones are protected.

Choose carefully

Think long and hard about which family member to insure. For example, would it benefit you more to be covered for the loss of earnings of the main breadwinner - or the cost of childcare from the loss of a stay-at-home parent. Maybe they're equally important - in which case, you might want to take out joint cover. The decision is yours.

Tell it straight

Make sure you tell the truth about your health and lifestyle. If you lie or fail to fully disclose this information to get a cheaper premium, then your policy might not pay out.

Read the fine print

Before committing to a life insurance policy, make sure that you're adequately covered - and getting exactly what you want. If you don't check these facts, your dependents could miss out on the money they need.

Image by: Alan Cleaver