Life Insurance

In most cases, the older you are, the more you will pay for a life insurance policy. This is because you are considered to be more of a risk to an insurance provider as you have a higher risk of passing away while your policy is running.

Premiums will often remain fixed throughout the lifetime of the policy which means that you may save money by paying lower premiums if you arrange life insurance when you are younger.

Your lifestyle can have an impact on your life insurance premiums. If your favourite pastime involves adventures like rock climbing, scuba diving or flying light aircraft, you might have to pay higher premiums for life cover.

If you take part in high-risk activities, it unfortunately raises the risk to your life and the risk of insurers having to pay out early.

Smoking is a lifestyle habit that can greatly impact the amount you pay for life cover. Smoking unfortunately puts you at a higher risk for all sorts of health conditions which means that smokers pay more than non-smokers for equivalent cover.

Millions of people across the UK struggle with their weight. If you are substantially underweight, overweight or obese, arranging life insurance on your own can be tricky. It can often result in the premium you were originally quoted being increased (loaded) once the application has been assessed. In some cases, the application can even be declined.

The purpose of an increased insurance premium is to reflect the level of increased risk that the insurer is accepting. If your Body Mass Index falls within the range considered acceptable by the insurer, your weight will likely not have an impact on your application. It is worth knowing that different life insurance providers have different opinions of what an acceptable weight should look like.

Your medical history can impact the amount you pay for life cover and whether or not your application is accepted. Every life protection provider has a list of pre-existing medical conditions that may affect your life insurance premium. Some of the most common conditions include:

Arthritis
Asthma
Cancer
Cholesterol
Diabetes
Heart disease / high blood pressure
Mental health conditions
Obesity

Depending on your pre-existing medical condition, insurers will want to know if you have had any health issues in the past – whether that is recently, or at any point in your life.

The amount of cover you need will impact the cost of your insurance premiums. The more money you need to insure, the higher the premiums will be.

To assess how much life insurance you need, your Adviser will ask you the following questions:
• Mortgage – How much is outstanding? What is the remaining term of the mortgage?
• Rent – How much rent do you pay per month? Also, consider how much your rent may increase in the future
• Debts – What is the total amount owed and over what term?
• Outgoings – regular monthly bills such as travel costs, utility bills, council tax, school fees and maintenance payments
• Family – How many children/dependents do you have? How old are they? And how long do you feel they will be dependent upon your income/care?

Future Proof will look for the best possible option that’s within your budget.

The length of your insurance policy will be an important consideration. Not only do you need to consider the cost of your insurance premiums, you will also want to avoid the term ending too early if the need for life insurance is still there. The longer your policy term the higher the premium will be. This is because there is a higher risk for the insurer having to pay out within the term.

Re-applying for insurance at an older age will likely mean you paying a higher premium over an extended term.

In order to assess how long your life policy is best to run for, your Adviser will ask you:

• How long is the term of your mortgage?
• What is your expected retirement date?
• Do you have any outstanding loans – over what term are they?
• How many years do you think your children will be dependent on you?

The answers to these will help determine the length of the life insurance policy and the amount you will pay.

Sadly, there is nothing anybody can do about their family’s medical history. If heart disease, strokes, cancer, and other serious conditions run in your family, your risk of developing these conditions can be raised.

Some insurers that place a higher emphasis on your family’s health than others. If you need help, our team can find the most accommodating insurance provider according to your circumstances.
An insurer is usually interested in any medical conditions that have affected your parents or siblings which may have led to an early death.
If you have a family history of any serious medical conditions it will likely have an impact on your insurance premiums.

The nature of some occupations means that they are more dangerous than others.  If you work in a job that is high-risk, it could mean that you will end up paying higher premiums. For example roles that include diving, overseas business travel, and working at heights and some military roles can fall within this category. Your occupation is a factor we look at when comparing quotes.

Terminal Illness Cover is an insurance option available to provide financial support in the event of a diagnosis of a serious medical condition. It pays out a tax-free lump sum if you die or are diagnosed with a terminal illness during the term of your policy. This can help with expenses such as medical bills or home adaptations. Most life insurance policies include Terminal Illness Cover as standard. This means that if you are given less than 12 months to live during the term of the policy, most insurers will pay out the sum assured while you are still alive.

The levels and bases of taxation and reliefs from taxation can change at any time and are dependent on individual circumstances.

A Waiver of premium is an additional benefit that can be included in your life insurance policy and offers protection in case you are unable to work due to a health condition, accident or sickness. Adding a waiver of premium means your life cover premiums will be paid by the insurance company until you are able to return to work. If you find yourself unable to work due to an accident or sickness. A Waiver of Premium is only available if you are employed, and usually only until you reach the age of 65.

An index-linked life cover policy ensures that the cover amount increases on an annual basis to combat the effects of inflation. This is important because, over time, the real value of your payout may decrease. For example, with inflation, £100,000 today will be worth less in 20 years as the cost of living increases and the prices of goods and services go up.

By index-linking your life insurance policy, you can ensure that it maintains its value over time. It is important to note that your premiums will increase annually. Most providers give the option to opt out of indexation, meaning you can freeze your premiums and sum assured at any point, even temporarily.

Including critical illness cover in your life insurance policy can provide you with an additional layer of protection. Although it may be more expensive than basic life cover, it can provide a tax-free lump sum payout in the event of being diagnosed with any of the critical illnesses covered under the terms of the policy.

When adding critical illness cover, there will be a single payout. On death or the diagnosis of a critical illness whichever happens first.

It is essential to note that the terms and cover of critical illness policies can vary significantly between insurers. Therefore, it’s recommended to seek advice when selecting a policy with critical illness cover.

A life insurance quote is an estimate of how much you might pay each month for a life insurance policy (commonly called a ‘premium’).  Your initial quote will be based on the personal information you have provided. If you are happy to proceed, an exact quote can be obtained after an insurer has your full personal details including medical history.  

A life insurance quote is not an offer of insurance, the offer will come after the insurer has assessed your application.

Our expert advisers will obtain exact quotes for you by contacting multiple insurers, so you can avoid repeating yourself. We will report back with the most competitive premiums and comprehensive insurers.

To get a life insurance quote and to give insurers the information they need to assess the level of risk they will be accepting, our advisers will typically ask you the following questions:

• Your age
• Whether or not you smoke
• Your height and weight i.e. Body Mass Index
• How many units of alcohol do you drink in a week?
• Have you ever experienced any mental health issues?
• Do you undertake a lot of business travel overseas or mileage?
• Whether or not you have used any form of recreational drugs in the last 5 to 10 years
• Is there a family history of serious illness before the age of 65 years (parents and siblings)?
• Do you take part in any hazardous pursuits? E.g. diving, rock climbing, sailing, motor racing?
• Do you have a high-risk occupation? E.g. working at heights, in dangerous countries, at sea?
• Whether or not you have any pre-existing medical conditions such as diabetes, high blood pressure or Arthritis

Comparing life insurance quotes may not be as simple as choosing the cheapest premium payments. Here are some things for you to consider:

• What percentage of claims does the insurer pay out?
• How comprehensive is the policy compared to others on offer?
• What additional benefits does the insurer offer included in the premium?
• Are there any conditions placed around the payment of terminal life insurance?
• Is there anything important to know in the small print, which might affect a claim?

A simple quote at the beginning will not consider your medical history. Once the insurer has assessed your application form and medical history, your premium may rise.

There is no right or wrong answer to how long you should get life insurance for. Some people, simply want enough protection to cover their mortgage, which may be 20-30 years. Some people prefer to have longer protection to ensure their dependents are always looked after.

It is very much a personal decision. If you are unsure, you can speak to one of our advisers to discuss your options.

Although cheap life insurance may look attractive, it may not be worth it if you do not have the right cover. You may also come across very attractive insurance quotes only to find that the insurer raises your premium by the highest amount after assessing your medical history or lifestyle.

An online quote is just that – a quote – it isn’t a definite offer of cover. What really matters is the premium you are offered, after your application has been assessed. Understanding which insurers are most sympathetic to your condition will save you time in searching and money.

Getting a quote online can be a quick way to get an idea of how much life cover could cost you. But a cheap online quote may not take into account the important information you will be asked for at the application stage. If you have a pre-existing medical condition, high-risk job or take part in any dangerous hobbies, a quote that a Future Proof adviser will take into account your circumstances and budget. It means that the price you are quoted will usually be much more accurate than a simple online process. A cheap quote online may seem attractive, but it may not be the price you eventually pay.

At Future Proof our buying power and close relationships with Insurance underwriters means we can discuss any premium increases with them directly and find ways to minimise them where possible. Our advice comes with no obligation and no hidden costs.

According to the Association of British insurers 98% of life insurance claims were paid out in 2022. 

Data provided in an ABI news release in Cover Magazine 30th May 2023. Quote provided from ABI .

Yes. There are many types of life insurance policies that cover different types of insurable interests, so you can have multiple life insurance policies at the same time.

For example, you could have one life policy to cover each insurable interest below:

• your mortgage
• protect your family that covers their bills
• cover a loan that will need to be repaid upon death
• cover private school fees

During your life insurance application, you will be asked if the amount of insurance cover you are applying for, added to the amount you already have, across all insurance companies, exceeds:

• £1,000,000 life cover or
• £500,000 critical illness cover

This question is to ensure that you are not over-insured. You must have good reasons for the amount you want to insure.

There are many different types of life insurance policy and forms of life protection. Each life insurance provider may take a different approach to an individual and their personal circumstances meaning life insurance policies are rarely the same. This is why it can be beneficial to speak with a knowledgeable insurance provider.

Here are some examples where life insurance policies are different between insurers

• Service – Insurers vary greatly from the ongoing service they provide to the percentage of claims paid.
• Additional Benefits -Most insurers provide additional benefits which are included within the premium. These can vary greatly and may offer things like Private virtual GPs for your family, nutritional support, mental health support or the best doctors who will give a second opinion on diagnosis. Many of our clients agree that paying a little more to access these benefits are important to consider.
• Terminal Illness cover – There are many factors that differ between insurers when it comes to terminal illness cover. The small print will determine when a claim can be made and when it won’t. It is important to know what your insurer offers.

Because each individual’s circumstances vary, there is no single insurance company that qualifies as being ‘the best’. The ‘best insurer’ is simply the company that provides the most comprehensive policy, with the most useful additional benefits at an affordable price for you.

For more information, read our guide on best life insurance

You can cancel a life insurance policy at any time. You will not be charged a cancellation fee. If you are feeling the squeeze with income, in the current economic climate, help is at hand. There are things we can do to ease your financial worries and safely reduce your premiums without shifting the focus of your needs for the future.

If you want to protect your loved ones, having some form of life cover is always better than having no cover.

Find out more here. 

When you purchase a life insurance policy, you can choose who you want to receive the money from the policy when you die. This person or people is called the beneficiary. You can choose to put your policy in a legal document called a trust or in your will. If you do not do this, the rules of intestacy will decide who gets the money from your policy.

When you put your life insurance in a Trust, it ensures that the money from your life insurance policy is given to the people you want after you die. A Trust is a legal agreement where a person (called the settlor), gives ownership of their assets to another person called the Trustee.

The Trustee is then responsible for managing and using those assets for the benefit of a third person, called the beneficiary. Placing your life insurance policy in Trust can be helpful for planning how your assets will be distributed after you die and can also prevent the legal process called probate, which is how a person’s assets are distributed after they die. The benefits of a life insurance Trust.

Trusts are not regulated by the Financial Conduct Authority.

Although the overwhelming majority of life insurance claims are paid, around 2% of claims were declined by insurance providers according to the Association of British Insurers (2021).

The reason for this is because of something called non-disclosure. 

No-disclosure is where a critical piece of information was left out by the applicant at the time they submitted their application. For instance a serious medical condition which may have contributed to their death.

When a life insurance claim is made, medical information about the death will be requested by the Insurer. If this enquiry reveals aspects of your medical conditions that you did not disclose to an insurer during your application which meant you have unfairly been paying lower premiums instead of higher ones, this will likely result in the claim being denied.

If you want to ensure your life insurance claim is paid out in full, you should always be clear, honest, and open during your application.  It is important that you disclose all your medical information and past medical history.

If you apply with Future Proof our advisers will complete the application with you over the telephone to ensure nothing is missed out.