New Life policy?

[geegee]

I currently have a “whole of life” life assurance policy and the premium is “guaranteed to sustain the benefits for 10 years assuming 4.8% net growth”. The policy is coming up to six years old. Is the premium likely to rise significantly on the tenth anniversary? I know growth rates have been low over the last six years.

Would I be better taking out a Term Assurance policy covering me up to age 65? I know that life rates have come down since 1999 but serious illness rates have gone up significantly (the policy has relatively high serious illness cover). It is dual life and/or double payout.

Any advice would be appreciated.

GG.

 

[ClubMan]

Would I be better taking out a Term Assurance policy covering me up to age 65?

It really depends on your personal circumstances, if you have dependents , what lifestyle they are accustomed to etc. Is this life assurance policy separate from any mortgage related life assurance/protection that you may have? Other than for mortgage protection there are no hard and fast rules of thumb for an appropriate level of general life assurance cover as it depends so much on personal circumstances etc. It might be worth checking if your employer provides any life assurance and/or permanent health insurance cover possibly bundled with their pension scheme to avoid the possibility of overinsurance.

 

[geegee]

Is this life assurance policy separate from any mortgage related life assurance/protection that you may have?

Yes.

I do know the cost of life assurance has reduced but serious illness has increased but would a new policy be necessarily cheaper?

 

[ClubMan]

There's probably no easy way to tell unless you shop around. Make sure to carefull assess your needs for this sort of cover as opposed to depending on generic rules of thumb.