One way of obtaining cheap life insurance is to take out level term insurance. This type of policy comes with low premiums and is one of the easiest forms to understand. You would decide on the amount of life insurance you need and the term you want to take it over. You would then pay a premium for the insurance and if the policyholder were to pass away during the term of the cover loved ones would get the sum insured. However should the policyholder outlive the term of the policy there would be no payout and the policy simply expires.
If you wanted a guaranteed payout on your life insurance then take a look at what whole of life assurance provides. You would choose the amount of life cover you wanted and then pay a premium. Providing you continue paying the premium the life insurance would payout a lump sum guaranteed whenever the policyholder passed away. However as the payout is guaranteed the premiums for this type of life insurance are generally dearer. It is still possible to get cheap life insurance if you compare the cost online with a specialist broker.
When deciding how much life cover to take out your personal circumstances have to be taken into account. You would have to give some thought to how much financial security you want to leave your family. Take into account any outstanding mortgage you have left to pay, children and this would include educational needs and the cost of childcare if your partner should have to find work. As a very rough guide you could aim to insure between 10 and 20 times your annual salary.
Many factors are taken into account when you apply for cheap life insurance. One of the main things taken into account is your age. The younger you take out life insurance the cheaper the premiums would be. Maintaining a healthy lifestyle can help to keep down the cost of your life insurance. If you are within the weight range for your height then you would be able to get cheaper life insurance than someone who is obese. Your occupation will also be taken into account. If you have a job in an office the premiums would be cheaper than for someone who cleans windows in high storey buildings for example. Any ongoing illnesses would also mean that you would have to pay higher premiums, for example if you have asthma or diabetes you would expect to pay more for life insurance than someone in the peak of health.
David Thomson is Chief Executive of BestDealInsurance an independent specialist broker dedicated to providing their clients with the best deal on their life insurance, critical illness cover and home and motor insurance.
Written by : David H. Thomson
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