Guaranteed premiums give boost to whole life

by Gill Montia

Story link: Guaranteed premiums give boost to whole life

Life Direct, the independent financial adviser, is raising awareness of the benefits of whole life insurance.

According to Steve Wroe, a spokesperson for Life Direct, most people opt for term insurance when taking out life cover because they are not aware that premiums on life policies can be guaranteed.

Until recently, whole of life policies had renewable premiums, so that the cost of a policy was guaranteed for only an agreed number of years.

This meant that at policy reviews, substantial premium increases could be applied.

Term insurance is probably the best option for those buying life insurance to cover items such as school fees or a mortgage.

However, whole life insurance, whilst being more expensive, can offer a high level of reassurance at reasonable cost.

Fool.co.uk, the online financial advice site, points out that with term insurance, where the company pays out a fixed sum if the policy holder dies within a certain time, consumers gain by being able to purchase a high level of cover.