Does this sound ok?

tony_cluedo

Been with Zurich for last 5 years. Got the life policy when I took out the mortage. It's been coming out of the wife's account so I basically forgot about it. Turns out they've increased the premiums to £70 a month for £200,000 cover. I nearly cried when I realised what we've been paying.

Anyway, no use crying over spilt milk. I've looked at Cavendish and got a quote with Aviva for a tenner a month.

Im in the building trade and a little tight for money at the moment. I was thinking that I could get a policy for 5 years for the amount to cover my mortgage. At some point in the next couple of years I'll be earning more and could cancel this policy and take out a new policy for an increased amount. This increased amount would cover the mortgage and provide some benefit to surviving family. There are no children yet so that is not an issue at the moment. Obviously we'll be a little older so premiums will be a little more then too.

Does this sound like a sensible thing to do?

Oscar_The_Grouch

I think the sensible thing to do is get a financial adviser.

tony_cluedo

Not very helpful.

I've been to an IFA. They quoted me £50 a month.

dunstonh

I've looked at Cavendish and got a quote with Aviva for a tenner a month.

Zurich are expensive but £70 to £10 suggests you are not comparing like for like as the difference would not be that much.

Does this sound like a sensible thing to do?

No. What if you become ill or injured in that 5 year period and become uninsurable or too expensive to insure?

You should be able to make a saving over Zurich but you need to be careful of cutting back too much and leaving yourself too short in key areas.

tony_cluedo

The Zurich plan is for £200k over 25 years. We are about 4 years into that. The Aviva quote for a tenner was for £200k over 5 years. The policies are indeed like for like.

If I bump up the lengh of the Aviva policy up to 25 years the price goes up to £15 a month. Taking your advice , I would go with the £15 a month quote to protect against something changing in our personal circumstances. That would not stop me from cancelling/modifying that policy in a couple of years if I wanted to increase the benefits from it to reflect children or increased income.

Is that a fair assessment?

dunstonh

The policies are indeed like for like.

I dont believe they are

If I bump up the lengh of the Aviva policy up to 25 years the price goes up to £15 a month.

£15- £70 is not going to be like for like. Chances are you either have an investment backed plan or it has critical illness and/or other cover included within it and are comparing it with just a pure term assurance plan with nothing extra.

If the IFA has quoted £50 like for like then there is no way Aviva would offer cover at £15 like for like. The commission to the IFA would only add a few pounds to the premium on £15.