Level Term Assurance Cost Cutting/MoneySavingExpert.com Discussion

eilz

Thanks dunstonh

Thanks, but I definately dont have an endowment policy, it is a Life Assurance policy, which If cancelled I would get a very small percentage back of what I paid in, unless I leave it till am gone. So switching over in April, I would lose out on the payments made since I opened the policy, only getting a small amount back.

dunstonh

remember pure term assurance never achieves a value. Its like house or car insurance. If you are going to save more over the remaining term than the value is likely to increase by, then it may still be worthwhile.

One thing to be wary of here is that you say it isnt an endowment. If it does achieve a value, it could be a whole of life policy. They used to be very common with an investment element. So make sure you are comparing like for like.

JenniO

Please excuse my ignorance, but is it 'usual' or 'unusual' for a life insurance company to request your doctor to send in your medical report before agreeing the insurance? I'm not sure if I seemed so 'normal' in my application that I was 'red flagged' or was it just a random sample and they choose my medical report to see?

Any advice appreciated.

dunstonh

JenniO wrote:

Please excuse my ignorance, but is it 'usual' or 'unusual' for a life insurance company to request your doctor to send in your medical report before agreeing the insurance? I'm not sure if I seemed so 'normal' in my application that I was 'red flagged' or was it just a random sample and they choose my medical report to see?

Any advice appreciated.

Depends on how you answered the questions. If you answered in such a way that increases the risk, then the insurance company may write to the doctor to seek clarification on those issues.

A random sample may well be made but remember it costs the insurance company a lot of money to get this information from the doctor. Sometimes it can cost as much as the first years premiums. So, its not something they will usually do without needing to.

JenniO

So I guess you are saying by answering questions an honestly as I could, I had some sort of health issue that 'red flagged' me to make the insurance company want to see my report. Therefore, I am more the 'unusual' than the usual practices upon taking out a life insurance policy?

dunstonh

JenniO wrote:

So I guess you are saying by answering questions an honestly as I could, I had some sort of health issue that 'red flagged' me to make the insurance company want to see my report. Therefore, I am more the 'unusual' than the usual practices upon taking out a life insurance policy?[/QUOTE

Dont think that a medical condition makes you unusual. However, if you did answer a medical or lifestyle question in a certain way, then it is far more likely to result in being referred to underwriting than a clean application.

Sometimes it may not be a direct health question. It may be the size of the sum assured, marital status, height/weight ratio etc.

ksh123

I am worried about not having life insurance but finding it very difficult to find an insurer, even with an IFA. I have just been turned down by L&G even after a largely positive medical carried out by my GP. I have a variety of medical conditions, none of which are life threatening per se but I am 53, fat(related to 2 of the medical conditions) and a smoker.
Despite these medical conditions my health is largely good, in fact I am fitter than many of my thinner,non smoking friends; and I do not have any blood pressure or heart problems. So I don't expect to pop my clogs for a while to come but accidents do of course happen and I don't want my daughter (my only relative)to be left with my debts.
The trouble is I am on incapacity benefit so need something affordable if possible.
Can anyone help?

dunstonh

ksh123 wrote:

I am worried about not having life insurance but finding it very difficult to find an insurer, even with an IFA. I have just been turned down by L&G even after a largely positive medical carried out by my GP. I have a variety of medical conditions, none of which are life threatening per se but I am 53, fat(related to 2 of the medical conditions) and a smoker.
Despite these medical conditions my health is largely good, in fact I am fitter than many of my thinner,non smoking friends; and I do not have any blood pressure or heart problems. So I don't expect to pop my clogs for a while to come but accidents do of course happen and I don't want my daughter (my only relative)to be left with my debts.
The trouble is I am on incapacity benefit so need something affordable if possible.
Can anyone help?

L&G are one of the better ones for underwriting in my experience. Friends Provident could also offer an alternative but you should really be instructing your IFA to look at alternatives. With an application completed already, he/she should be able to phone round the various companies underwriting teams to see what their views are on it. However, you may find this bit costs if the premium is small and the IFA/protection advisor feels it is unlikely to yield a response.

Your daughter will not be left with your debts. On your death, your debts are taken into consideration with your assets and are paid off out of those assets. Any shortfall that may exist after that, is written off. Any surplus follows your will.

ksh123

thanks for this advice, tho its discouraging to hear that L&G are one of the better ones:(. But I will ask my advisor to make more contacts and suggest Friends Provident.
I understand about the debts but I would like her not have lose anything from whatever little bit I can leave!

the-mad-one

This insurance stuff is its complicated so make sure you get good INDEPENDANT advice. My husband and i both have term assurance policies which we took out when got our reducing mortgage 3 years ago (werent told of reducing insurance) but i wouldnt be without the knowledge that if anything happens to either of us there is enough to pay the mortgage and leave the kids a good lump sum. Ours covers 21 years (full term of mortgage) and as our youngest was only baby at time will see them all thro to adults. And its very reasonably priced.

A lot of people say dont see point in it when you dont get anything back after the term, but consider your car insurance, house insurance etc, unless anything happens and you need to claim, you dont get your money back either!! And believe me life assurance is cheaper than the car - and your kids dont need a car to survive when your gone!!

Last thing i will say is PLEASE PLEASE make sure you keep up payments. I had a friend who unfortunately passed away last year, after a year of illness, but prior to that had been off work a while and didnt contact their insurance company to get sickness payments, so the insurance wasnt paid and lapsed. So when she was diagnosed with terminal illness, didnt get any payout, and when she passed away her family were left with nothing. So PLEASE if you do nothing else, pay the life cover, its the most important thing you will ever do for your kids!