Buying insurance
The general rule with getting insurance of any type is to only get what you need. If you're single with no dependants you probably won't need life insurance, but you may wish to consider protecting your income.
So don't get too much, but don't get too little either. The key is to make sure you needs are covered. Sometimes it can be hard to compare one policy with another - they've all got different benefits and cost different amounts. When you do take out a policy, make sure it really does cover you for what you want.
As always, shop around and use price comparison websites to check out the best deals. Cost savings and quality of cover will vary greatly, so bear in mind that higher prices do not necessarily guarantee higher quality in the world of insurance. However, the more cover you want, the higher your premium is likely to be.
Try to get three quotes and compare them with each other. Look out for any waiting periods, exclusions, excesses and no claims bonuses.
If in doubt, get expert, unbiased information from a qualified insurance broker (for home, car etc) or independent financial adviser (for life assurance, income protection etc).
The stress of making a claim can be huge, especially if you've suffered something traumatic. So the last thing you want is for your insurer to make a fuss and be difficult about paying out. For that reason, it's well worth picking an insurer that has a good reputation - this could be based on a personal recommendation from family and friends or a previous experience you've had or through your own research using websites.
Once you've decided what you want to cover, take out the insurance as soon as possible. Your circumstances could change and you may not be able to take out the cover later.
Top tips
- Make sure you shop around to get the most competitive insurance.
- When your insurance renews always look around for the most competitive cover you can find based upon cost and the conditions of the policy. It's often cheaper to switch to new insurer than stay where you are. Many insurers offer introductory discounts in the first year which apply to "new customers only!"
- Always compare the terms of an insurance policy - one may seem cheaper but may not provide the same level of cover.
- Don't be pressurised into insurance by your bank, travel agents etc, you may be able to obtain more competitive cover elsewhere.
- Insurers charge a high rate of interest to allow you to pay your premium in monthly instalments. If you can afford to, it's much more cost effective to pay your premium in one lump sum.
- Answer any questions asked fully, clearly and accurately. Don't give any false information when applying for insurance. This will make your policy invalid when trying to make a claim.
- To make sure you are fully covered you can challenge the insurer to confirm in writing that your particular circumstances are covered.
- Just because an insurance company has sold you a policy doesn't mean you'll be eligible to claim on it.
- Watch out for insurance policies that include non-essential benefits as part of their cover. These add-on's can push up the cost of the policy.
- Try to review your policy from time to time and update it if necessary.