Whole of Life - Life Insurance

Mindy_2

We have a Whole of Life plan with Guardian Financial Services called a Freedom Plan.

We have had it since 1991 and the premiums were £39.39 to start with.

There is annual indexation which is quoted in the policy document as "Annual Indexation will apply to Protection Benefit(s) in line with the RPI (assumed at 5.00% pa). Contributions will also increase in line with the RPI except where the plan is on Maximum Protection, where they may increase at a higher rate than Protection Benefit(s)."

We deleted the indexation option from the plan for one year which was in 2003/2004.

In 1995 we had a part surrender of £1,338.60.

According to the statement we received dated 31 October 2006 (the 2007 statement is buried somewhere in my office under all the piles of paperwork that I am wading my way through), the Life Assurance Protection is showing as £317,691.00 for my DH and £218,316.00 for me, the Cash Value of the Plan is £3,049.16. We are now paying premiums of £90.68 p/month.

I am 47 and my DH is 45 (we have a mortgage of £150,000).

I will have difficulty in finding another life insurance policy as I come into the obese category.

We have horrendously huge debts (as can be seen from my sig), so I want to find out from those who know:

Is this a good policy for us to have?
Should we cash it in to help pay for our debts?

Any other comments would be welcomed.

Thanks