Life assurance

Dymo

I have a life assurance policy that I took out when purchasing my house about 10 years ago. The policy is for €317,000 and the premium is €81 per month. That premium is guaranteed to stay the same for the rest of my life, it was a special the banks had at the time and have since stopped this policy.

Does it make sense to keep this policy? and would I be better off taking a cheaper policy, I got a quote for a 40 year policy @€;37 per month or €27 over a 30 year period which to me would seem like a huge saving over the 40 years.

I'm in my mid thirty's

Thanks

Pablo Sanchez

Are you sure that the policy you have is really 'whole of life'?

You mention that your premiums are guarenteed not to increase, could it be a policy for a specific 'term' ie 30/40 years? (generally term policies premiums are guarenteed). Whole of life policies are generally reviewable and inevitably get pricier as you get older.

If you are paying c. €90 per month till your 80, from age 30 (ie 50 years) that means you would only pay 54k into the policy before the average person would die. If your covered for over 300k you can see why a life company would not offer whole of life policies with guarenteed premiums.

That said, if you did somhow get that deal pm me and let me know who its with........i want in!

Dymo

Yes it's a policy that won't be reviewed that's why they pulled it after a cuple of monks, its with Arklife. It just seems expensive now at €81 per month where as I could get a 40 year policy for €37

I suppose it depends on your circumstances. If you have dependents and have no other Life Insurance Cover, then it may be wise to hold on to it. The premium is guaranteed and the Sum Insured stays the same also.

It sounds to me like the €37pm is for a 'decreasing term mortgage protection policy' ie. the sum insured decreases over the years. You might want to clarify this.

A 25 year old male (non-smoker) could expect to pay about €180per month for that same level of cover on a guaranteed whole-of-life policy today (€150pm for Female).

miketheDIYman

Like many Senior Citizens who took out Life Assurance policies when they first married, I am astonished how the Unit linked reviewable premiums keep rising each year , the plan seems to be to get you to cancel and leave the Big Companies with all your hard earned cash. Now I know this topic has been aired here before and in the papers and on radio, but I feel if enough of us get together - people power can make things happen, even if we could get a reasonable settlement on cancellation, even a few thousand, wouldn't that be great. Forget the small print,these type of policies ar prohibited from sale nowadays, doesn't this say something !!!
Come on, join in and lets get this sorted *****

Henry Ford III

Guaranteed premium whole life policies were certainly available at one stage from more than 1 provider. Not sure they are now.

Unit linked reviewable ones can be cruel as folk get older. I've seen quite a few that become uneconomic to maintain.

miketheDIYman

Yes, Henry - mine is one that is reviewed fairly frequently and inevitably costs more and more as the years go by - The ombudsman says he can do nothing but I am not happy with his response - look at mortgage protection policies and similar where people have had their money refunded !!! I am 68 and on State Pension so unable to meet premium increases - but I'm not going to cancel without a fight

JTMan

Dymo wrote: »

I have a life assurance policy that I took out when purchasing my house about 10 years ago. The policy is for €317,000 and the premium is €81 per month.

That is very expensive. It is several multiples of what I pay.

Have you tried a life assurance online broker like LABrokers.ie? I got life insurance from Royal London via LABrokers for 21 EUR a month.

miketheDIYman

Yes henry They are Extremely CRUEL and I have heard the premiums really rise when you get to 70 and over !!!

Henry Ford III

miketheDIYman wrote: »

Yes henry They are Extremely CRUEL and I have heard the premiums really rise when you get to 70 and over !!!

If the policy is bombing out at every review it'll just get worse and worse. The reviews are 10 at years, and then become every 5 years. I think they become annual reviews eventually.

ANXIOUS

miketheDIYman wrote: »

Yes henry They are Extremely CRUEL and I have heard the premiums really rise when you get to 70 and over !!!

Could you not look at reducing the level of cover? At 68 you don't have the same need for cover as you would have at 38 and a small family.

miketheDIYman

Been there / Done that - they say thats the last reduction we can have :mad:

ANXIOUS

miketheDIYman wrote: »

Been there / Done that - they say thats the last reduction we can have :mad:

It must be at a fairly love level of cover, I suppose it depends on the product and company. They probably all have different rules, for the most part some you would see would have a residual cash Value built up.

miketheDIYman

The level of cover on ours is reduced to 49,000 on both lives - so not that low
and in 37 years paying the preniums, last encashment value only a few months ago was € 250 !!!

ANXIOUS

miketheDIYman wrote: »

The level of cover on ours is reduced to 49,000 on both lives - so not that low
and in 37 years paying the preniums, last encashment value only a few months ago was € 250 !!!

Have you tried replacing it with a term life policy? I know that this would generally only provide cover to get 85.

Browney7

miketheDIYman wrote: »

The level of cover on ours is reduced to 49,000 on both lives - so not that low
and in 37 years paying the preniums, last encashment value only a few months ago was € 250 !!!

But you didn't die in that 37 years. It's comparable to paying for car insurance a d not crashing. Have you assessed why you currently need life cover?

miketheDIYman

Maybe so my wife will not have the expense of my funeral and to help cushion her future existence on the state pension - not all people have huge private pensions

Henry Ford III

miketheDIYman wrote: »

Maybe so my wife will not have the expense of my funeral and to help cushion her future existence on the state pension - not all people have huge private pensions

Have you looked at any alternatives?

miketheDIYman

are there any for a 68 year old - don't think so

Henry Ford III

miketheDIYman wrote: »

are there any for a 68 year old - don't think so

Depends what you need/want and possibly on your health situation. There are always options.