Life Direct: Despite whole of life safety most choose term insurance
October 10, 2007 by admin
Filed under News, News-Insurance
The majority of people decide to take out term insurance rather than whole of life insurance, even though the latter offers guaranteed security.
According to a spokesperson for Life Direct, Steve Wroe, many people are unaware that nowadays whole of life insurance offers assured premiums which is why they are choosing term life insurance.
Mr Wroe said: “Life insurance is just about peace of mind and the trouble with a term policy is that one day that policy is going to stop working for you.
“You might still be living, but you might not be insurable if you try replacing it because you might be too old or you might have come down with some medical issue since you took your term policy out that prevents you getting life cover.”
He added that people who are younger often opt for term insurance whereas the older generation are more likely to choose whole of life policies for funeral expenses and to “leave a little bit of extra money”.
The Motley Fool explains that with a term policy, a payout is offered if you perish within the term specified, getting the largest sum possible.
Whereas, with whole of life insurance offers a fixed payout upon death as long as premium payments are kept up. This provides “investment for your heirs” and requires you to take a “gamble” on your life expectancy.
