Life Insurance Guide – 7/7

Moneysupermarket.com has compiled an exclusive guide to life insurance. In part six we take a look at money saving tips.

Saving money

Buying life insurance online can save cash as it cuts out the ‘middle man’. At moneysupermarket.com we will compare more than 100 insurance products to find the policy that best suits your needs. Here are some important elements to look out for:

• ‘Written in Trust’ – If your policy is written in trust then in the event of a claim this means that the money goes directly to the person you nominate. It also avoids your estate paying inheritance tax which could mean a 40% tax saving.
• Joint life insurance – This is normally written on a first death basis, meaning the policy pays out on the death of the first policyholder. It will save money but bear in mind that it will leave the second policyholder to potentially try and get a new life insurance policy at an affordable premium in old age. Overall it will work out to be more expensive in those circumstances.
• Critical illness – A life insurance policy with critical illness cover will work out much cheaper than two separate policies. Also remember to differentiate between critical illness and terminal illness cover. Most policies will automatically include terminal illness cover but the critical illness policy will pay out the lump sum for a range of illnesses with no life expectancy criteria.