Life insurance proc fees

Amst

Hi, I've dealt with mortgages and various insurances over my working life but never been involved with Life insurance or Critical Illness. Does anyone know the procuration/commission levels on a policy which would be around £40 per month over 30 years?

Somehow the thought of going through a comparison site and getting Meerkat Meals or a £35 gift card doesn't seem like I'm getting the best rewards for taking out a policy I'll probably never use.

dunstonh

Does anyone know the procuration/commission levels on a policy which would be around £40 per month over 30 years?

There are no proc fees. Life assurance is fee or commission based only. The level of the commission can set by the distributor. Comparison sites would be very low.

ACG

Most brokers will get around 20x the monthly premium, so £800 give or take. Some brokers and banks will have "loaded premiums" which means the commission (and premiums) will be more. We will usually then get a few pence each month from the 4th year onwards.

Typically the price comparison sites will get less than that, but not all of them. When I used to work for a life office, some of them got the same as a "normal" broker.

Sounds like a lot, which I suppose it is but you have to put it in to context. Every year we have to pay the FCA, the FoS and our insurers just for the ability to write insurance. That can be thousands of pounds.

We are also liable for the advice, so if it turns out to be the wrong policy or mistakes on the policy then you have protection there - which you would not on the price comparison sites.

- Im not trying to justify the commission - actually I suppose I am, but only because on the face of it it seems a lot.

Amst

I've not got a problem with a commission based policy - thanks for the response both. I'd just rather give the commission to a broker than an online comparison site just to get a cuddly toy...