There are a few ways to set up a Life insurance policy. However, before we get to that stage it is important to understand what type of life policy you want.
We made a post on the different types of life policies here. The main types of life policy though are Term assurance, Family Income Benefit or whole of life. They differ in a number of ways such as how, what and when they pay out, whether there are any additional benefits and whether the policy is in trust.
Once you have decided on type of policy and any extra benefits you may want then you need to look at how you can take out a policy.
What are my options for setting up a Life policy?
There are a couple of ways:
A Mortgage or financial advisor can help set up most life policies. Although a Mortgage broker may not be able to set up certain investment based policies. Usually there is no direct cost involved, the life provider would normally pay commission to the adviser.
Your bank may be able to help. The downside here however is that a bank is normally tied to one provider and may have “loaded premiums” this basically means the premiums are higher in order to pay more commission. It is typically seen as the worst choice due to limited options and potentially higher costs.
Going Direct. This relies on you doing the research yourself. It also relies on you understanding the terminology and what you are signing up for. There is not usually any advice provided and so if you do something wrong, there is no recourse.
How can we help?
As Financial advisors, we have years of experience, we have our qualifications and our experience under our belt. We do regular training on protection (as this is a regulatory requirement).
This means we have a good understanding of the products, the providers, the added extras, trusts and we can help tailor a product for your needs based on a quick chat.
In addition to that if you have any health issues, the way insurers view those conditions can vary significantly – from higher premiums, exclusions or just being able to proceed as normal. We have systems in place to find which insurer will offer the most suitable terms for your circumstances.
Summary
There is absolutely nothing stopping you setting up your own policy.
However an advisor can help narrow down the best type of policy or policies for your needs. They can help to narrow down the best provider based on health or past times, price and any additional extras you want included in the policy – a personal favourite being a parent is Best Drs for example. But there are many other extras you can view on the first link above.
An adviser can also help to narrow down the trust options to help ensure any pay out gets paid to the beneficiary as quickly as possible.