Aviva Life Insurance Question 5 August 2018 at 5:08PM in Insurance & Life Assurance 3 replies 497 views

Freddykrueger69

Until recently I was using an IFA but recently have begun to look at some of the products that were recommended and wanted to get some sage advice on here. My question is mainly weighted at the fact that I don't think he took into account insurance I get with my work.

Anyway I'm a 49 year old male and what I pay with Aviva monthly is approx £123 - for this I get roughly 204k of life insurance and the same amount in critical illness. It is broadly in line with the mortgage debt although I have an offset mortgage so the actual balance is 60k less when you take the savings into account.

With my work I get 4x salary in life insurance and also now get income protection which covers 70% of income if off work.

Should I be shopping for a better deal - it's only for myself by the way not my wife.

Weighty1

Personally, I typically advise my clients to discount their death in service provisions. Normally, it's not contractually guaranteed so could be removed at any point, or you could change jobs for a better salary but it may not have the same benefits. It's good as a bonus payout but I don't think it's good to rely on it.

The income protection is another matter. You can't claim on 2 income protection plans at the same time so if you also have personal cover this could be worth reviewing.

dunstonh

My question is mainly weighted at the fact that I don't think he took into account insurance I get with my work.

Most people are underinsured when it comes to life assurance. So, its worth remembering that as a starting point.

Death in service is discretionary and people move around jobs more frequently than they used to. So, it's not a reliable source for long term planning.

Plus, Death in service is really meant for short-term loss of income and reduced pension benefits (if you die before building years of service in the pension, there will be a shortfall in spouse retirement provision - this fills that partially).

So, either doing a full analysis including it for its main objectives or leaving it off altogether makes sense.

ACG

Also, it is probably more or less the same price (within say £10 a month) to have life and critical illness as it is critical illness on its own.

I would disregard the DIS as others have suggested.

For the Income Protection, this is bit trickier. Do you pay for something you will have come what may or bank on the company policy that could also end up being withdrawn as a benefit... In your shoes, I would probably be thinking the same as you.