Life Insurance – under the spotlight

Could your life insurance cost you less than you think?

What is a Life Insurance policy?
Quite simply, it pays out a tax-free cash lump sum to your loved ones should you pass away. It can provide peace of mind that your family will be financially safe if the worst should happen. The money can be used to pay off a mortgage, support costs of children left behind and help with household bills and expenses.

Are there different types of policies?
There are three policy types available with several insurers to choose from. It’s always best to seek advice when thinking about life insurance, as everyone’s circumstances will be slightly different.

  • Level term insurance

This policy will last for a fixed term (e.g. 10 – 25 years) and the policy will only pay out if the insured dies during the term of the policy. The amount of cover, as well as the premium, will remain the same throughout the length of the policy.

  • Decreasing term insurance

This policy will run for a fixed term and pay out if the insured dies during the term of the policy. A decreasing term policy is usually used to cover a repayment mortgage because the pay-out reduces alongside the mortgage.

  • Whole of life insurance

This policy is guaranteed to pay out when you die, so long as you have consistently maintained your premium payments. The amount of cover, as well as the premium will stay the same throughout the policy.

Who needs a life insurance policy?
Life insurance is suitable for most people and is something that everyone should consider. Anyone who owns a home (with or without a mortgage), parents, anyone with dependents (children, elderly, disabled, non-working spouses), and anyone with outstanding debt should have cover.

However, there are a few groups of people a life insurance policy isn’t suitable for. These are students and anyone without dependents. Anyone without dependents but still with commitments should look at an income protection policy. This would cover loss of income through accident, sickness or unemployment and provide peace of mind should a life change occur.

Did you know life insurance may not be as expensive as you think?
If you have a clear medical history life insurance can often cost less that your Netflix subscription or a round of drinks in your local pub. The best way to find out your individual cost is to get a quote with advice and understand what options you available to cover your loved ones if the worst may happen to you.

The cost of life insurance will depend on several factors;

  1. Your age. Age is a large factor; a life policy is always best when purchased at a younger age.
  2. Whether you smoke. Smokers are deemed a higher risk than non-smokers.
  3. The amount of cover. The higher the cover, the higher the premiums.
  4. The length of the policy. The longer the policy term, the greater risk to the insurer.
  5. Your health and lifestyle. The insurer will ask questions about your medical history, your family’s medical history and questions around drinking and smoking.


A life insurance policy is best purchased with advice so a qualified advisor can look at all the options for you and make recommendations based on your personal circumstances.

Top tips

  • Talk to a qualified advisor for FREE – the A-Plan Life & Health team can help with this.
  • Think about what you need to cover, and how much you can afford on a monthly basis.
  • When thinking about your sum assured, it should be enough to cover your mortgage and some extra to help your loved ones when you’re gone.
  • Your policy term should be at least as long as your mortgage.

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