Top Life Insurance Tips

Life insurance can feel like a complex beast to navigate. But fear not – we’re divulging our top life insurance tips to help you get the cover you need for the best price.

In This Guide:

• Choose the Right Type of Life Insurance Policy
• Buy Life Insurance When You’re Young
• Calculate How Much Life Insurance You Need
• Be Completely Honest in Your Application
• What Not to Say When Applying for Life Insurance
• Consider Adding Critical Illness Cover
• Avoid Policies Offered by Mortgage Lenders
• Frequently Review Your Policy
• Life Insurance Tips to Get Cheaper Premiums
• Life Insurance Advice 101: Compare Deals for the Best Price
• Final Life Insurance Advice

Choose the Right Type of Life Insurance Policy

Choosing the right term life policy or permanent life insurance plan when buying life insurance can save you money and ensure your family is protected. Each life insurance policy offers unique benefits depending on your financial situation, goals, and personal circumstances.

Here are the most common life insurance policy types:

• Level Term Life Insurance: Pays out a fixed lump sum if you die during a set period. Ideal for covering mortgage debt or providing financial stability for your family.
   
• Decreasing Term Life Insurance: The pay-out reduces over time, making it a cost-effective option to cover debts that shrink (like a mortgage). Monthly premiums are typically significantly cheaper.
   
• Family Income Benefit: Rather than a lump sum, your beneficiaries receive regular monthly payments. Ideal if you're looking to replace lost income over time.
   
• Whole of Life Insurance: A permanent life insurance policy that lasts your entire lifetime and guarantees a pay-out whenever you die – ideal for inheritance tax planning and funeral costs.
   
• Joint Life Insurance: Covers two people (typically couples). A joint policy is cheaper than two separate policies, but only pays out once – usually upon the first death. The surviving policyholder is no longer covered after that.

Buy Life Insurance When You’re Young

When it comes to life insurance policies, time isn’t your friend. The younger you are, the more likely it is that you’ll get a cheap life insurance deal that, importantly, still offers the level and standard of cover you need. As you get older, there is an increased risk of health problems and less time you’ll pay in for on the whole, meaning premiums are much more expensive. If you're applying at a younger age, honesty can work in your favour, as you're more likely to secure lower premiums and broader cover while in good health.

Calculate How Much Life Insurance You Need

Don’t over-insure yourself unnecessarily – work out exactly how much your family or beneficiaries would need to be comfortable should the worst happen. There are many life insurance calculators available online for this reason, and consulting a financial adviser can help you avoid paying more than you need to.

But similarly, don’t under-insure yourself either. Otherwise, you risk leaving your family with less financial security and cover than they need to get by – especially if you have a joint life insurance policy, where the pay-out only happens once. Make sure to factor in future costs like university fees for children or ongoing mortgage debt.

Plus, while we all want to get the best life insurance deal going, don’t ever downplay your health or circumstances. If you don’t honestly disclose your overall health and situation, you risk invalidating your policy altogether.

Be Completely Honest in Your Application

To get the best life insurance policies, you must be honest about your:

• Medical history
   
• Lifestyle (including smoking, alcohol use)
   
• Family history of health conditions
   
• Employment risks

If you're not completely honest, your insurer may refuse to pay out when the policyholder dies, leaving your loved ones with nothing.

What Not to Say When Applying for Life Insurance

When applying for life insurance, honesty is everything. Saying the wrong thing, or omitting key information, can result in your policy being invalidated later, even if you have been paying monthly premiums for years. Here is what not to say:

• “I don’t smoke” – if you do, or have in the last 12 months, you must declare it. Even occasional social smoking counts.
   
• “I’m in perfect health” – if you have had recent health issues, undergone tests, or have a family history of certain conditions (like heart attacks or cancer), this must be disclosed.
   
• “I don’t take any medication” – unless this is completely true. All prescriptions and even over-the-counter meds that treat chronic issues should be mentioned.
   
• “I’ve never been hospitalised” – if you have had surgeries or treatment in the past, even years ago, this could be relevant depending on your policy.
   
• “I don’t do any dangerous activities” – if you participate in risky hobbies like skydiving, scuba diving, or motorsports, this could affect your life cover and must be disclosed.

Be completely honest during the application process. Most policies are underwritten using the information you give, and discrepancies can lead to rejected claims and it would end up putting your family at risk.

Consider Adding Critical Illness Cover

For extra protection, consider adding critical illness cover to your life insurance policy. This add-on provides a lump sum if you're diagnosed with a serious condition such as cancer, heart attack, or stroke – helping cover medical bills, lost income, or ongoing care costs. It’s especially useful for those with dependents or major financial commitments. While it slightly increases your monthly premium, it can offer valuable support and peace of mind during life’s most difficult moments.

Avoid Policies Offered by Mortgage Lenders

When you take out a new mortgage, you could find that many lenders won’t loan to you unless you have a life insurance policy. It’s likely they’ll offer you one themselves, but don’t accept it and instead use our search function to run a life insurance comparison. This is because mortgage lenders tend to offer policies at inflated policies, so you’ll get a much better life insurance deal elsewhere.

While having life insurance isn’t a legal requirement, it should be strongly considered; if your family can’t keep up with mortgage payments in the event of your death, their home could be repossessed.

Frequently Review Your Policy

Circumstances change over time. You might take out a life insurance policy when you have a large mortgage to pay off, are at the beginning of your career or have a young family to support. This is when money is tightest. But over time, what you’re left to owe on your house is reduced, your children grow up and become independent and you may be at the top of your career, meaning your savings have increased.

As such, you could afford to reduce your policy – if so, consider a decreasing term insurance plan.

Life Insurance Tips to Get Cheaper Premiums

What life insurance deal you can get is affected by several factors such as: your health, your age, where you live, whether you smoke, the amount of coverage you want and the policy term.  

While your age and certain aspects of health, such as pre-existing medical conditions, can’t be changed, it’s possible to make other adjustments to get a better life insurance premium.

Stopping smoking, cutting back on the drink and improving your health and fitness will considerably reduce your quote. You’ll often have to prove to your insurer that you’ve made these adjustments for at least a year.

How much you want to insure your life for will, of course, also have a significant impact on the life insurance cost you pay, alongside the policy type.

Life Insurance Advice 101: Compare Deals for the Best Price

You should always follow life insurance tips and compare life insurance deals when you initially want to take out a policy – this’ll ensure you get the best premium. But what if you want to switch from an existing deal say, for example, if there’s been a change in your circumstance or you need a different type of policy?

In this case, you can change policies. However, should you choose to switch from your existing policy in this competitive marketplace , be aware your options will decrease over time. On the whole, you’ll see premiums rise and competitive deals be more limited, which is why we recommend running a life insurance comparison to scope out what’s on offer. On the other hand, if your circumstances have changed in a positive way, you could find you can tap into much better life insurance deals than you previously could.

Final Life Insurance Advice

Getting the best life insurance deal starts with understanding your needs and the options available. Remember:

• Compare policies before you buy
   
• Be honest in your application
   
• Reassess your cover regularly
   
• Improve your health where possible
   
• Buy when you’re young to get lower premiums

While life insurance isn’t a legal requirement, it offers peace of mind and financial stability. If you want to ensure your family home is protected or that your loved ones won’t be burdened by outstanding debts, don’t wait, buy life insurance today.