Cost Of Life Insurance Shown To Have Decreased In Real Terms

Whichever way you look at life, life insurance is inevitably something we all need to think about purchasing. Whether you’re young or old, life insurance is important because while you might not be expecting to die anytime soon, life is unpredictable; and if you have dependents, you need to make sure they will be provided for in some way in the event of your death.

Hitherto, many people attribute their lack of life insurance to high cost. However, new research appears to suggest that the cost of life insurance premiums has decreased substantially over the past ten years. According to a study done by Barclays Life Insurance, living costs in the UK in the past decade have risen by 16%, but the price of average life insurance premiums has halved during the same period.

Mark Till, managing director of Barclays Insurance observed: “we all seem to remember our money going a lot further in the past than it does these days”. The main contributors to the higher cost of living in the UK include rising property prices, as well as increases in the price of petrol and tobacco; higher taxes and rising energy costs have also played a large part in pushing prices up.

This evidence of the steadily decreasing price of life insurance surely indicates that, if you’re planning to buy life insurance but haven’t yet been able to do so, now is the time. In fact, more and more people seem to be taking advantage of the decreasing price of life insurance; in early November, insurance company AXA SA stated that its nine-month revenue had risen by 11.6% from a year ago, due to the strong sales performance of its life insurance and savings business.

If you are thinking of buying life insurance, it’s always best to study the market and compare the different life insurance policies available so you can find the best policy to suit your own personal requirements. For instance, many people buy term or “protection-only” insurance, which pays out if you die within a specified amount of time; this is much cheaper in the short term, particularly if you have received news of a sudden illness. However, in the long term, it is always better to choose investment-type life insurance []; this builds up in investment value throughout your life, which you can even cash in on before you die. This way, the earlier you buy investment-type life insurance, the greater the accumulation of value during your lifetime, and the better the provision for your dependents!

Mobile Phone Insurance More Important To Britons Than Life Insurance

A study by Legal and General has found that Britons think it is more important to protect their mobile phone from loss or theft than it is to insure themselves against critical illness, accident or death.

The most surprising result from the survey highlights the fact that possessions are more likely to be insured than the person owning them. Most people surveyed, over 54%, had no protection policies whatsoever, while 22% had their phone insured compared to 17% who had critical illness and life assurance. Income protection was considered important by only 14% of those questioned.

Furthermore the survey finds that significantly more people have insured their home contents than their life, with over two-thirds of those questioned saying they have insured their home against 41% who say they have insured their life. Time and again the insurance industry reports that there is a huge gap between the amount of cover that UK citizens have taken out and estimates how much should actually be taken out to cover everyone, and this survey suggests that gap is in no danger of closing.

Legal and General’s protection sector Marketing Director Bonnie Burn’s thinks it is a worrying trend. She said:

“The priorities of the nation seem mis-guided, with people more concerned about the loss of their mobile phone than how they would cope financially if they could not work, through illness or serious accident. We all hate facing up to our mortality, but when insuring our life is considered less important than insuring our possessions, then perhaps it’s time for something to be done.”

The fact that people are willing to pay for relatively expensive phone insurance, but not for life or critical illness cover is particularly depressing news for the UK life insurance industry. When you compare life insurance cover pound for pound against mobile phone insurance the figures make sobering reading. For example paying an average premium of £4.99 a month would result in paying almost £60 a year for a phone worth around £150 – over a third of its value in one year. Many people take out this insurance unaware that they may also be covered for mobile phone loss or theft on their home contents policy. On the other hand a 30 year-old man wanting £200,000 life cover would pay on average only £13 per month; a lot more cover for your money! It appears that even through the majority of us have it ahead of any other protection cover mobile phone insurance most definitely works to the benefit of the insurer.

This news comes on top of the news issued by government that estimates that almost seven million working Britons are not making enough provision for their pension. That combination of inadequate income, critical illness and life cover, and pension provision suggests that many Britons are financially ill-equipped to face the future, and could face real hardship if the worst should happen.