This website specialises in helping people with medical conditions access good value financial products.
If you are in good health the process of obtaining life insurance is much easier but you still need to apply in the most efficient way possible to obtain the best value cover.
This page will look at the most effective ways of obtaining your cover.
If you have a pre existing condition or for a more detailed guide on life insurance in general please see our pre-existing medical conditions life insurance page, where you will find details on the types of cover available, amounts of cover to apply for and other useful tips.
Top Discount broker offering life insurance
If you are in perfect health or have a very minor medical condition then Cavendish Online is an excellent choice in sourcing your life insurance.
If you know the type and level of cover you need Cavendish Online simply take a fee of £25 for arranging your policy. They then refund any commission received back into the policy which will reduce your premiums.
If you are unsure of what cover you need they also offer an advisory service where they will guide you through the many options available. If you take this route they still discount the premiums by refunding part of the commission received. They claim this will still be cheaper than comparison sites.
Why don’t I just apply through my Independent Financial Advisor (IFA) or a Comparison Site?
Ok, let’s deal with the Comparison Sites first.
Firstly you need to know how they (and other brokers and IFAs) get paid for life insurance sales. This is a simplistic explanation but they generally receive a lump sum commission based on the size of your monthly premium. A typical level of commission on a £20pm policy would be in the region of £400. Providing you keep paying your policy for (usually) four years they keep the £400. If you cancel your policy within four years they will have to pay back some of the commission on a pro rata basis, so if you cancel after two years they will have to pay back half the commission, £200.
If you are in good health it can literally take a matter of minutes to source, apply and issue your life insurance policy. As can be seen from the example above this makes selling life insurance very lucrative, especially if you are in good health and don’t require advice.
With this in mind Comparison sites such as comparethemarket.com or gocompare.com will often accept a lower level of commission which has the effect of reducing your premium. As another simplistic example, if they reduce the commission by 50% it will reduce the premium by around 10% so your £20pm policy becomes £18pm.
So what about IFAs?
This isn’t as straight forward as IFAs can take their payment in different ways.
On one end of the spectrum some IFAs will take the full amount of commission on offer and offer no premium discount. On the other hand, if you have a good relationship with your IFA, they may forego all the commission and just charge a small fee. This is more likely if you are using the IFA for other business such as Investments or Pensions, just make sure you ask!