Cost of Life Insurance

Causeway305

When my son was born 25 years ago we started 2 life policys.  One in my name insuring my wife and my wife insuring me.  I read the adverts that if 55 and no life insurance then for £10 per month. Not sure why after 25 years we are still paying almost £150 per month.  I'm reluctant to cancel and loose everything we have paid in but why is the cost so high?

dunstonh

I read the adverts that if 55 and no life insurance then for £10 per month.

i think you will find its from £10 per month.  And the sum insured will reflect the premium you pay for the type of cover for you age.

e..g £10 now for an over 50s plan (which is an option of last resort for those that cannot get conventional life assurance) may only get you £1000 of cover.     How much does your existing life assurance pay out?

Not sure why after 25 years we are still paying almost £150 per month.  

its about the same as I am paying.  So, what is your issue?

I'm reluctant to cancel and loose everything we have paid in but why is the cost so high?

Almost certainly because the sum assured is higher.  There may also be bolt on cover such as income protection and/or critical illness cover.

Sandtree

Causeway305 said:

When my son was born 25 years ago we started 2 life policys.  One in my name insuring my wife and my wife insuring me.  I read the adverts that if 55 and no life insurance then for £10 per month. Not sure why after 25 years we are still paying almost £150 per month.  I'm reluctant to cancel and loose everything we have paid in but why is the cost so high?

You need to dig out and read what you are actually paying for as its likely you are comparing totally different policies especially given your age when you took out your current policies.

csgohan4

150 a month is expensive, but it is all relative. Policies 25 years ago are certainly different to ones now

kingstreet

Causeway305 said:

I'm reluctant to cancel and loose everything we have paid in but why is the cost so high?

Do these plans have a savings element?

Aretnap

Generally speaking life insurance gets more expensive as you get older. However comparing prices between two policies is meaningless without knowing what sort of policies you're dealing with. In particular

(1) How much cover does you're provide, and how much does the one you've seen on the internet adverts provide? A policy that will pay out a million quid will cost more than one that pays out a couple of thousand pounds. A £10 a month Over 50s policy you've seen on a dodgy internet advert is unlikely to pay out a mortgage-sized amount of money...

(2) Is yours life insurance, or life and critical illness cover? If it's the latter the the critical illness part is the expensive bit. Critical illness insurance costs several times as much as life insurance, because it is much more likely to have to pay out

(3) Does your policy have an investment element? That's what you're implying by mention of losing what you've paid in. Investment linked life insurance policies are not a mainstream product these days but were a thing 25 years ago, so you could be comparing two completely different types of product with completely different benefits.

Your needs will doubtless change as you get older and your children grow up so it does no harm to consider whether you still need your policy, but make sure you understand what it actually does, and if you are looking a other policies make sure you understand the differences between them before you do anything precipitate.