Whole life insurance – minimising the risk
Whole life insurance is just that – it’s a policy that pays out when you die, no matter when that may be. It’s one way of making sure that your dependents are financially secure after your death. Premiums are often more expensive than those for term or life assurance, because the insurer knows that a payment is guaranteed, but as with all policies, whole life insurance products come in different shapes and sizes.
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Why think about the risks?
Your whole life insurance premiums will be partly dependent on the insurance company’s assessment of how likely it is that you will die early – so that you’ve paid less in premiums than the insurer will have to pay out. There are several things that may increase your risk of dying, and which will, in turn, increase your premiums. The fewer risks you have, the more time the insurers will calculate you have, and the lower your premiums will be.
What are the risk factors?
Each whole life insurance policy provider will have a slightly different assessment of your risks, but they will normally include:
- Your general health – a whole life insurance application form will ask for details of your current health. If you have had health problems such as heart attacks, or you are recovering from cancer, or have high blood pressure, this could affect your premium. The company may also ask if there are any medical issues in your family history that could affect your own health.
- Smoking – unfortunately, if you are a smoker, your premiums will rise. Whole life insurance companies see smokers as being at a high risk of contracting a terminal illness. Some companies may ask you how much you smoke, whilst others will simply increase the premium once they know you are a smoker.
- Your work – certain occupations are more high risk than others. If you work in a relatively safe environment, such as in an office, or a school, your risk of death at work is reduced. High-risk occupations may be those that require you to work at height, with dangerous substances or in life-threatening situations, such as the military or at sea.
- Your hobbies – your choice of non-work activities may also affect your premiums. If you are a paraglider, extreme skier or snowboarder, mountain climber or scuba diver, you may find that your whole life insurance company considers your hobbies to be a risk to your life and increases your premiums accordingly.
- Age – your age is a factor in your whole life insurance quote. The younger you are when you take out the policy, the lower your premiums are likely to be. If you apply for a whole life policy at around your retirement age, your chances of death are increasing and your premiums will be higher.
Jump Money is a specialist in life insurance and is happy to answer any questions you may have related to life insurance, life assurance, term assurance and life cover. The company will strive to fit an insurance package to the exact criteria you need in order to help you avoid buying products you do not need as well as helping you fully understand your purchase. To find out more about how Jump Money can help you protect yourself and your belongings call now on 0845 8516262 or fill in an online quote form today.
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