Life Insurance question

Cill25

Hi,
We've just recently had a baby and wondering who best to contact about setting up life insurance (we have protection on mortgage but obviously want to be sure that family are looked after financially if I die),
Any advice would be appreciated,
- best provider
- any small print etc to watch out for
Many thanks,
C25

I would go with something like a Convertible Term Insurance over 25/30 years. Fixed term, sum insured and premium.

You have the option to 'convert' the policy, without medical evidence, during or at the end of the term to another policy. Do bear in mind that the rates for the new policy would be the rates applicable to your age at the date of 'conversion'.

If you are self-employed, or in employment and not a member of a pension scheme you can put in place a term policy and get tax relief, at your highest marginal rate, on the premium. This also applies to PRSA contributors.

For the life cover, I think that labrokers.ie might be your best bet.

Sonnenblumen

Term(typically 10 years and covers one life but you can take out one for spouse etc) life insurance is cheapest but in the long run, ie if you longer it can prove expensive and inflexible. As you get older, cover conditions start to kick in and premiums rise sharply.

A whole of life policy covers both spouses, usually indexed link and doesn't have any real sneaking bits around 5, 10 anniversarie or medicals etc.

Plus if one spouse dies, the policy continues to cover surviving spouse. These policies are linked to investments and offer cash surpluses even when no claim is made. Would recommend over term.

But if money is tight a term policy will cover you until you become more liquid.

You can buy single life, joint life or dual life term insurance. You can also index link a term policy.

A typical unit-linked whole of life policy has a review on the 10th anniversary and every subsequent 5th anniversary up to age 65. At that age some companies review the policies annually. These reviews are always upwards( i.e. premium increases) and can be penal. The life cover cost may be guaranteed for the first ten years but all bets are off after that and you are at the mercy of the Insurance Company thereafter.

The possibility of a cash surplus will all depend on the premium that you are paying from the outset. The more you pay for the policy, the more likely there is to be a value attaching to the policy at some stage in the future.

This is a personal opinion, but mixing life insurance and savings in one policy is nuts. The typical commission paid on a whole of life policy is 90% of the first years premium. Why would you 'save' money in a policy like this?

A guaranteed(premium fixed) whole of life policy is expensive and in my opinion does not offer good value for money.

Just consider all the options and then make an informed decision.

Cill25

Thanks all,
Better understanding of it now, just got to get on with,
Cheers,
C25