Is whole of life insurance more expensive?

The premiums for whole of life insurance are typically paid throughout your life and then a lump sum is paid out upon your death to your nominated beneficiary.

This may mean that whole of life insurance is generally more expensive than other types of life insurance policy. Here are some other pointers to consider:

•       Lump sum payment guarantee. Unlike some other types of life insurance policy, a payment at the end of the policy is generally guaranteed as long as all the terms and conditions of the policy have been met and premiums are up to date;

•      Premiums. Premiums may be higher than other policies (for example, term life insurance) on a monthly basis. However some policies may offer you the opportunity to take cash out of the policy should you need to;

•        What the policy covers. In return for a slightly higher premium you may find policies that will also make a lump sum payment if you are diagnosed with a critical illness. Although this may mean that the policy is more expensive, it may also mean that you don't need to consider investing in critical illness cover if you feel you do not need this element of cover;

•       Set premiums. When you are looking at a life insurance quote for whole of life insurance you may find some policies guarantee that the premiums will remain the same throughout the life of the policy. Although at the start of the policy premiums may be more expensive than an ordinary life insurance policy, if you have the policy for a long period of time the premiums may be low in comparison to the rate of inflation.

Choosing the most suitable life cover for you is important, so using the services of a specialist life insurance broker or provider may be the next step in getting covered.

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