Stephen Jines, Managing Director of investments at Cambridge based financial adviser AGT Independent Financial Services Ltd, counsels that it is very shortsighted of people not to have Life Insurance  cover and/or Critical Illness Cover as he insists that life has two potential risks – either being alive too long and passing away too soon.  “Its absolutely crucial to have some insurance in place – especially if you have got a young family,” he states. “In these uncertain times you need to build your own little stronghold because nobody else is can do it for you.”

Richard Hart at Moneynet says now is the ideal time to invest in such insurances as there are lots of very cheap premiums around due to to the fierce competition for business within the insurance industry. “The price of life cover has fallen – fallen about forty per cent in five years. It has never been as cheap,” he states. “The critical illness market paid out on 84 per cent of claims in 2004 – up from seventy eight per cent  the previous year.”

Be aware of what insurance cover you already have before you take out any more.  Do you already have investment policies or does your company pension fund give you any other cover?

The simplest way to estimate how much cover you require is to work out how much you would need to retain the same level of living over a year and then multiply it by 25 years.  The minimum amount needed should settle all debts and and leave a lump sum for your family.

Getting the best deals
When deciding on your policy it is very important to read the guide that many insurers have of the illnesses and conditions that they deal with. It will record everything and should be very clear and easy to understand.  You will also need to review the documentation of the crutial features of the cover which will take account of all exclusions and benefits.

When someone takes on the responsibility of a home loan they are usually counselled to take out critical illness insurance but should shop around and not just take the first insurance policy suggested. You need to consider a range of life insurance quotes.

If you start paying these insurances when you are young they are noticeably cheaper, very different to leaving it until you are older, when insurance cover goes up quite apppreciably.

Insurance premiums can also be lowered by giving up smoking.  Mary Lakes, head of protection at AxA Insurance says ” as well as giving a longer and healthier quality of life, giving up smoking can save people a vast amount of money.”

If you quit smoking you can take off as much as a 1/4 off  life insurance, critical illness  insurance and income protection insurance premiums because the evidence that we now have proves that smoking can instigate critical illness and exacerbates any other existing health conditions.

If your circumstances change you may have to alter your policy. Under no circumstances imagine that once you have bought your insurance policy that you can just continue with your life and dismiss it. Always be very aware of the insurance cover you have and be sure that, should your circumstances alter, or, is going to change your insurance must have capacity for these adjustments.  Clear examples are changing jobs, or do you intend to have more children; frequently think about everything that may raise your living costs and must be to be covered if you are unable to work.

The sale of life insurance policies is regulated by the Financial Services Authotity (FSA).

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Nothing is more harrowing in life than to be diagnosed with a serious or chronic condition. Matters are made much worse when your insurance company notify you that they won’t pay out on your critical illness policy or private medical policy for the HIV or cancer you are suffering from.

You are asked to read sub-clause four of paragraph 328 of the small print, which states that you are suffering from the the  wrong sort of cancer. Only tumours below the knee are covered and only the first five days of your treatment will be paid for, and then it is up to you to find the finance.

This situation may sound absurd, although brokers and insurance companies are regulated, this type of procedure continues to carry on. It has been a slow process to freshen up the industry and to make sure that consumers get a fair deal. That’s why you need mortgage insurance.

Just recently Cancer Backup, a registered charity, emphasizes this predicament by arranging a huge array of mystery shopping surveys, which brought to light some alarming facts about the private health insurance industry. It found that of all the leading insurers only HAS provided cover for cancer patients right through the length of their illness. Only immediate treatment is covered by most of the health insurance policies. Treatment or care over a prolonged period, such as hormone replacement or chemotherapy is not normally included.

Even though insurance companies and brokers want to finance long term cover for policyholders with chronic illnesses, they won’t always make it clear to would be clients, at the time of signing up what they are covered for. That’s why, when you are looking for quotes for mortgage cover, you need to be careful.

Although both  Cancer Backup and Macmillan Cancer support have been in discussions with similar organisations within the life insurance industry to raise the standard of sales practices and make the small print of policy documents much clearer, since the report was published two years ago, progress has been slow.

Critical illness cover and private medical insurance  is usually taken out by people who are comparatively fit and healthy. Getting cancer is the last thing to cross their mind. That is why it is imperative to specify an insurance policy’s exclusions before they sign.

A report of best practice for companies writing and selling medical insurance policies has been modified recently by the  ABI, which is a welcome step in the proper direction.

The trade body has now recommended that insurers and providers selling these forms of insurance should set up similar case studies, which explicates the conditions when a policy will or will not be paid. Sadly insurers no requirement to adhere to this code, which is voluntary.

While the  Association of British Insurers (ABI) initiative is to be appreciated, the best way of clarifying an insurance policy is by getting the salesperson to clearly explain the small print.

Then again, industry terminology is in spite of everything still being employed by insurers to bewilder the customer. For example it is wrong to categorize cancer as an acute or chronic illness, deliberates Cancer Backup. However insurance companies are definite that it should go in the chronic category. Consumers only learn about this when their claim has been rejected.

Although the ABI have got their responsibilities right, the insurance companies can only be required to better their standards by the regulator. Improved training of tele marketing staff, who sell the majority of the insurance policies, is also long overdue.

More thorough marketing procedures are crucial with jargon being removed. At the end of the day it falls upon the insurers insurance companies to make sure that their clients are fully aware of the terms of their insurance cover before they put pen to paper.

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Life insurance quotes help your dependants to be financially secure in the event of your death.

When you purchase set the cash value you want the insurance company to pay out when you die – this money is called the sum insured”. The monthly payment is based on this sum insured, and on your age and whether you are female or male.

Our premiums will also be based on the type of insurance policy you need. There are two fundamental types of life insurance: level term assurance and decreasing term insurance plus many variations within these categories.

Term assurance is often aquired at the same time as a mortgage and should cover the same period of time as the mortage. If you haven’t died at the end of the insured period, you will not get any money back. It is a basic insurance with no element of investment. It can protect your family by paying out a cash sum should you die within a specific time period.

There are two basic types of term insurance. Level term gives a constanly maintained level of payout during the entire life of the cover which means that you beneficiaries would receive the same amount whether you died on day one of the policy or whether you died right at the end of the term. It is usually sold with an interest-only mortgage, where the fullamount borrowedhas to be paid off on the final day of the mortgage’s term.

Decreasing term insurance is where the cash paid out reduces by a fixed amount each year, finishing at just one penny at the end of the term. Since the level of insurance cover reduces during the term, premiums on this kind of insurance are cheaper than on levelplans. This cover is usually only taken out with repayment mortgages, where the value of the outstanding mortgage reduces during the term of the mortage.

There is also a type known as increasing term insurance. It is also known as index linked insurance. This means that the payout sum increases by a small amount each year in line with inflation. Index linked insurance is a good way of protecting the buying power of the sum you have insured for.

With convertible term assurance, the policyholder has the option of moving to another type of life insurance – for instance a “whole of life”. If a person does take up this their convertable option, they do not have to have any more medical investigations.

If you chose a type of insurance called family income benefit your family would receive a tax free monthly income if you were to die and this income would continue until the policy reached its termination date. This gives your dependents regular payments from the date the policyholder died to the end of the policy’s term.

Critical Illness Insurance can be aquired on-line or from the high street through  insurance companies, brokers or from some friendly societies. Many sell directly to the public. Other outlets selling insurance include websites and mortgage brokers.

Factors affecting monthly premiums include the sum assured, sex, age and whether or not you are a smoker. Some insurers insist on a medical before offering cover, but this is not so common as in the past.

Life insurance prices can alter over time and if you already have a plan it might be worth shopping around to find out if you can get a cheaper deal. You can always stop your existing insurance policy without penalty – but always make sureyou have another one in place before you  cancel your existing cover.

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Have you checked whether your employer provides accident cover for you? Many companies do without the employee realising or remembering. Subsequently if you want this type of cover, it is well worth checking it out Also remember that accident insurance may incorporated in your life cover.

If you already have life cover and can afford to step up your insurance portfolio, then it could be advantageous to contemplate a relatively insignificant extra payment to purchase something like an income protection insurance, which would mean that you’d receive a monthly income whilst off work or even until retirement.

Income protection covers have be moulded to supply you with an amount of money each month, whilst you are off work because of an illness or accident. They’re planned to pay out until you reach retirement age. There are other alternative policies which come under the name of Accident and Sickness Insurance, that will pay out for a set time and some of these also contain cover for unemployment.

The Financial Standards Agency keep a watchful eye on the way in which consumers buy general insurance policies and have said ”There is a possibility that consumers purchasing it may not understand the limitations…..”
 In addition, it was underlined that they were concerned regarding the low amount of claims on these insurance policies which possibily be the outcome of excessive prices and a lack of competition. In another FSA review, this one based on “cold calling” selling techniques, the regulator was disapproving of the exceptionally poor sales standards for various products and cautioned that the advantages of accident insurance were “from time to time overstated”.
The low rate of claims, mentioned above, represents the amount of money paid in claims, against that received in payments is in general low.

For that reason, it’s doubtful that pure accident cover would benefit you enormously. It would seem to be much better then, to use a product that amalgamates disability or death insurance cover within a very broad life asurance policy

Most people do not know that many of the normal credit cards, such as Virgin Money, Egg,  Natwest,Halifax All In One, Capital One and  Barclay card to name a few, give “travel accident” insurance of up to 100,000 pounds, that covers you for accident or death which occurs while in transit which is supplied to the customer for using their cards.
When you have some time to spare, it is wise to sit down and see just what you own in the way of insurance cover. As is apparent, some, in fact a lot of, kinds of insurance cover have various benefits and it may be right time see just what insurance policies you do have and make sure that your present lifestyle hasn’t altered your insurance needs.
You’ll get all assistance you want by going on-line and checking out an independent financial advisor, you can weigh up your own needs, try out any reservations you have about present insurance covers and generally explore a very wide market to unearth precisely the right product for you and your loved ones.

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