Insurance seems very expensive?

hieveryone

:eek::eek:

Had a quote for Critical Illness/Life Insurance from broker - at a whopping £60 per month.

Is this the norm?

It is for a relatively large amount (approx £200k) to cover new mortgage, both young (30 and 33), fit and healthy.


I don't think I want to start scouring the net for quotes, as I understand this is recorded on your credit file, and I haven't concluded on mortgage yet so would like to avoid this if possible.

Thanks

nidO

Seems like it's in the right ballpark.
If you want to pay substantially less you'd need to ditch the critical insurance portion which (in my very limited experience) makes up the bulk of the cost, life only would probably be nearer £10-£20.

hieveryone

nidO wrote: »

Seems like it's in the right ballpark.
If you want to pay substantially less you'd need to ditch the critical insurance portion which (in my very limited experience) makes up the bulk of the cost, life only would probably be nearer £10-£20.

Ah ok, that's fine then - just didn't have anything to compare it to.

kingstreet

DEFAQTO rates these two products as "5 stars" for critical illness;-

cheapest £58.21

most expensive £73.58

31NB/33NB NS 25Y £200k decreasing life/critical illness/total permanent disability, guaranteed premiums, no waiver.

You appear to have been quoted towards the lower end of the premium spectrum for the better quality end of the cover market.

As an example, Beagle Street, Compare the Market's tame insurer is rated two stars by DEFAQTO for its life and critical illness cover.

hieveryone

kingstreet wrote: »

DEFAQTO rates these two products as "5 stars" for critical illness;-

cheapest £58.21

most expensive £73.58

31NB/33NB NS 25Y £200k decreasing life/critical illness/total permanent disability, guaranteed premiums, no waiver.

You appear to have been quoted towards the lower end of the premium spectrum for the better quality end of the cover market.

As an example, Beagle Street, Compare the Market's tame insurer is rated two stars by DEFAQTO for its life and critical illness cover.

Thanks Kingstreet, the policy quoted is from Legal and General Insurance and is called 'Mortgage Decreasing Term Assurance Quotation with Critical Illness Cover' on the Key Facts sheet - any idea whether this is worth it?

dunstonh

Had a quote for Critical Illness/Life Insurance from broker - at a whopping £60 per month.

Doesnt sound expensive. £50-£150pm seems to be the common range that I see.

the policy quoted is from Legal and General Insurance and is called 'Mortgage Decreasing Term Assurance Quotation with Critical Illness Cover' on the Key Facts sheet - any idea whether this is worth it?

It will be worth it if you suffer a claimable event. That is the thing with insurance. You could end up paying 20 odd years and never see a payout and at the end you may feel it was a waste (although you would be alive and in good health). If it paid out you will feel it was a good financial decision.

kingstreet

hieveryone wrote: »

Thanks Kingstreet, the policy quoted is from Legal and General Insurance and is called 'Mortgage Decreasing Term Assurance Quotation with Critical Illness Cover' on the Key Facts sheet - any idea whether this is worth it?

Has your advisor provided a suitability letter justifying the recommendation of Legal & General, or is this a L&G tied agent?

InsideInsurance

As others have said, the cost is all in the CI cover.

Do you understand what this product is? Are you sure you need it? What is your plan if you have another illness that isnt on your CI policy list and it means you cannot work for a few years?

enginesuck

I'm £42 a month critical illness and life for me and my wife. She doesn't have the critical Ilness cover though just life. But that's on a £135000 mortgage.

hieveryone

kingstreet wrote: »

Has your advisor provided a suitability letter justifying the recommendation of Legal & General, or is this a L&G tied agent?

I have the Key Facts/Illustration - this is an independent broker if that makes any difference. It complicates things that my partner works offshore too.

InsideInsurance wrote: »

As others have said, the cost is all in the CI cover.

Do you understand what this product is? Are you sure you need it? What is your plan if you have another illness that isnt on your CI policy list and it means you cannot work for a few years?

As far as I'm aware we do need it - we are taking on a large (:eek:) mortgage and although I am partly covered for sick pay through work, my partner isn't.

enginesuck wrote: »

I'm £42 a month critical illness and life for me and my wife. She doesn't have the critical Ilness cover though just life. But that's on a £135000 mortgage.

Thank you, that is a useful comparison.

InsideInsurance

hieveryone wrote: »

As far as I'm aware we do need it - we are taking on a large (:eek:) mortgage and although I am partly covered for sick pay through work, my partner isn't.

So would income protection not be better where you get a monthly payment until you are fit to return to work or hit 65 (or whatever age you want to set)?

CI only pays out a lump sum and only if you have one of a set list of conditions with a set list of markers. You can be too ill to work for months/ years but not trigger CI because its a condition not on the list, you can also find that CI pays out on a condition that doesnt actually impact you too much.