1. Ask Yourself Key Questions
These should include: What is your attitude to risk and how well protected do you want to be and from what situation? Making sure you know what you want to be protected from helps select the right policy. Is unemployment a fear? What happens to your home or your mortgage repayments if you die? Have you any children?
It is worth considering that unemployment rather than death is the highest risk. You are seven and half times more likely to lose your job than die between the ages 25 and 44.
2. Seek Advice
The most popular way is to approach an independent financial adviser (IFA) who will help you select the right type of life cover, whether it be mortgage protection, life insurance or income protection. An IFA will also help you find the best product, with quotes for life insurance likely to be wildly different.
3. Shop Around
For those who have a good idea of the type of cover they need, approaching providers direct can help find the right product at the right price, rather than hiring an independent financial adviser (IFA). The Association of British Insurers advises those considering buying life cover, mortgage protection or life insurance to also consider the quality of the product on offer, as well as the price. For example one firm's critical illness cover may extend to include around 35 illnesses and diseases. Even at an extra cost this could be more suitable for some customers.
4. Be Honest
Each year around 11%-13% of mortgage payment protection claims are not paid out, with a main factor being non-disclosure of information. The Association of British Insurers among others advises all customers to answer every question on their application forms truthfully and as fully as possible.
To start your search for a Life Insurance policy please see our Life Insurance Directory