INSURANCE - LIFE INSURANCE ? WHY DOES LESS THAN HALF THE UK POPULATION HAVE COVER?

Insurance > Life Insurance ? Why Does Less Than Half The UK Population Have Cover?

Life Insurance ? Why Does Less Than Half The UK Population Have Cover?

by: Michael Challiner

Less than 50% of the UK population has any form of life insurance cover, says Swiss Re, one of the largest insurance companies in the world. In their latest annual report they estimate that ?4.2 trillion worth of insurance cover is needed whereas only ?1.8 trillion has been taken up. That leaves an insurance gap of ?2.3 trillion.

But in all probability, the gap is not that large. Firstly, there's the people who are ruled out from having life insurance due to their age - just over 1 in 5 are under 18 years of age, the minimum for life insurance cover, and 1 in 6 are over 65 and they're effectively uninsurable. Then there's a raft of single folks aged between 18 and 65 without dependents, and for whom life insurance is just not necessary. Having said that, without doubt, there are still many families who desperately need life insurance but who don't have cover.

Why do they hold back?

There are still plenty of people who have no idea what life insurance does and because it's never top of their minds and they don't care, nothing ever gets done. After all life insurance isn't exactly a thrill to buy, there's no pleasurable window-shopping or sense of enjoyment about it. The likelihood is that unless a financial advisor sits down in front of these people and talks about life insurance, they'll remain totally uninsured and uninterested.

The media coverage given to the insurance industry also tends not to help. The press is regularly full of stories about one company or another that has turned down a claim. These stories make headlines as behind them, there's always a sad story of personal tragedy and distress. It all gives the industry a tarnished image and creates a feeling that they can't be trusted.

Then there are those who realise life insurance is needed but just can't be bothered or say they can't afford it. More realistically, for many ?can't afford? actually means, ?I choose not to afford?. They might be happy to spend ?2,000 a year on a 20 a day smoking routine but are unwilling to cut back to afford the monthly premium that protects their family's future.

Of course, there is no disputing the fact that some people will have applied for life cover and found the final premium truly unaffordable. Whilst for the majority, life insurance at normal rates is okay, over the last seven years we've seen a huge rise in the number of people who have seen the price substantially increased once the insurer has seen their application form. It's a result of the life insurance companies making it increasingly hard for people to meet the insurers definition of ?healthy?. Seven years ago half as many people were seeing their premiums increased as a result of the insurance companies rating them as an above average health risk.

Even three to four years ago it was pretty obvious who'd have trouble getting insured at normal rates ? someone with a history of heart or circulatory problems, former cancer suffers and diabetics for example. How the situation has changed. Insurers' application forms are now much more detailed and health problems that were previously considered acceptable are now only accepted with increased premiums. Take your weight ? insurers are clamping down when they judge a person's weight to be a risk to their longer-term health. And it's not just the obviously over weight that attracts the insurer's notice. Insurers are now using a measurement called the Body Mass Index to identify weight problems. This is a persons weight divided by the square of their height. Insurers now want a BMI of no more than 29, whereas previously up to 40 was fine. This means that a woman weighing 83 kilos and 1.66 meter tall would now face higher premiums.

People can also be put off by the application process. Whilst about 30% of applicants will receive a decision almost straight away, for others the process can become one delay after another. As if a 16 page application form were not enough, some people are being faced with more forms to complete plus medical examinations. The whole process can take up to 8 weeks, even more, before the applicant knows precisely how much their premium will be. If that works out more that they can simply afford, they're often too fed up of the whole application process to start again with a new insurance company. That leaves yet another family without insurance.

Despite these problems, the life insurance companies claim that thanks to more sophisticated underwriting procedures, premiums are lower today that they were a few years ago. Furthermore, around 10% of life insurance is bought on the Internet where discounting has become the norm. This too has helped push average premiums down.

Nevertheless, in the author's view it will take many years to get people covered by life insurance above the 50% mark.

About The Author

Michael Challiner writes for Brokers Online ( http://www.life-assurance-bureau.co.uk ) who offer life insurance cover and most UK financial services including mortgage payment protection ( http://www.life-assurance-bureau.co.uk/mortgage-payment-protection/ ). Visit our finance blog for useful tips on uk finance ( http://www.life-assurance-bureau.co.uk/family-finance/ )

michael@andromedawebs.co.uk

Insurance Providers Weather The Storm While Consumers? Claims Flounder

by: Richard Green

We have just had the first year?s anniversary of the flash flooding which occurred at Boscastle in Cornwall.
The floods saw some of the worst damage wrought by sudden rainfall in the UK for many years.

The flood was caused by the remains of a hurricane which crossed the Atlantic, collecting vast amounts of water crossing, and was then pushed high above an area inland of the village depositing around 1,500m litres (330m gallons) of water within two hours.

At the time insurance companies were estimating the bill for commercial damage to local businesses, would be as high as ?15m.

There is perhaps some comfort for insurers in that it could have been worse. Hurricane Charley, which hit Florida around the same time, cost over an estimated ?6bn.

In August this year, just a week after Birmingham was battered by a tornado, residents...

Insurance Providers Weather The Storm While Consumers? Claims Flounder

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by: Joseph Kenny

Animal lovers have been saying it for years, but animals, especially pets, are people too! While this is usually meant as a joke, there are elements of truth in it. Many people consider their pet to be a member of the family, and especially for children, the companionship of a loved pet can be something they?ll remember and cherish for their whole life.

That is why there are some things that you should think about for your pet. Obviously you will want it to be happy, and you should therefore make sure that you are feeding it well, with nutritious and healthy food. This doesn?t mean going overboard and giving your dog steak every day, but there are plenty of good quality pet food brands on the market and if you choose one of these it should keep your pet happy and healthy.

Another thing you may wish to give consideration to is housing and space. Make sure you have enough space for the pet...

Looking After Your Pet?s Health

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It?s easy to see which company is least expensive, but when you need them to cover a claim, what kind of job will they do? To put it another way, which is the most reliable insurance company?

Here?s some quick tips to help you choose the right insurance company for you.

Visit your state's department of insurance and check consumer complaint ratios and basic rate comparison surveys.
Get in touch with local body medical practitioners you trust and ask which insurance companies they recommend.
Consider contacting an insurance agent for additional information about a particular insurance company.
Check out the financial strength ratings for an insurance company by referring to the A.M. Best and Standard & Poor's ratings.

There?s so much to think about when looking for the right insurance company; we?ve already...

How Do I Choose A Good Insurance Company For My Needs?

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by: Derek Gardner

Numerous economic experts believe life insurance to be the basis of sound economic planning. It is in general a cost-effective way to take care about your loved ones after you are departed. It can be an important instrument in many ways.

Income substitute

For the majority of people, their main financial asset is their capability to make a living. If you have people depending on you, then you need to think about what would happen to them if they suddenly do not have your income to count on. Income from a life insurance policy can help complement retirement income. This can be particularly useful if the benefits of your surviving other half or family partner will be reduced after you pass away.

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Why Should I Even Bother To Buy A Life Insurance?

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While saving for a pension and having good medical insurance are two of the most common steps, there is also the scope for long term care insurance, which may also be of great potential use in certain situations. This type of insurance covers the need for assistance in old age. Old age, as well as mental and physical illness can lead to many people needing assistance with such everyday tasks as eating, bathing and dressing. Simply looking after you can be too much for many people and when they are faced with this situation, assisted living and long term care can be an option.

Long-term care insurance...

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The first thing you want to do is prevention. Most insurance claims can be prevented even before the incident occurs. For instance, to prevent auto accident?s be cautious and think about taking a defensive driving course. To prevent stolen vehicle insurance claims, keep you vehicle locked up and parked in a secure place. To prevent damage from the forces of nature do not travel in bad weather and keep your car in a covered parkway. There are many ways to prevent yourself from incurring loss. Most ideas are just common sense. However, for more information contact your insurance agent for ideas on...

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What is no load life insurance? No load insurance is fairly uncommon, but many consider it better than the average whole life insurance package. Life insurance no-load simply means that it is not commissioned-based.

The first year payments are much less compared to traditional life insurance packages. No load life insurance also has other notable features like zero cash surrender charges and earlier cash value accessibility. However, most life insurance companies still do not offer no load insurance. Still, if there is no load insurance available in your area, you should consider getting no load insurance instead.

How Does No Load Insurance Exactly Work?

No load insurance isn't exactly made to eliminate the need for life insurance agents or brokers. Instead, the fee structure of no load insurance has been changed. Life insurance advisors are paid by potential life insurance...

The Ins And Outs Of No Load Life Insurance

Insurance > The Ins And Outs Of No Load Life Insurance

The Ins And Outs Of No Load Life Insurance

The Ins And Outs Of No Load Life Insurance

by: Jon Butt

How Does No Load Insurance Exactly Work?

The Ins And Outs Of No Load Life Insurance

Insurance > The Ins And Outs Of No Load Life Insurance

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