There are a number of places where you can buy life insurance but there are pros and cons to each. It is important to choose wisely so you buy the right life insurance to financially support those you leave behind but also at the cheapest price you can get.
In this article, we explain where you can buy life insurance as well as how you can get up to £100 cashback when you buy your life insurance policy.
Where can you buy life insurance?
You can buy life insurance with a:
- Life insurance broker
- Bank
- Post Office
- Supermarket
- Comparison site
- Mortgage Broker
Where you buy your life insurance will dictate how much help and guidance you can expect to receive when making your selection. Life insurance pays out in different ways depending on the type of life insurance you choose. Often, if you buy your life insurance from a place that doesn't provide advice, you will need to know exactly what type of life insurance you need and how much life cover you need.
If you have a medical history that you will need to disclose, it is usually best to speak with a specialist life insurance adviser to avoid the insurance providers that may either decline your application or charge you more for your monthly premiums than you may find elsewhere. Pre-existing medical conditions can sometimes cause no increase to the cost of your life insurance but you will have to source the right life insurance provider to achieve this.
What to look out for when you buy life insurance
Largely you should ensure that the life insurance you buy suits your needs and is affordable to you. Life insurance is meant to provide financial support for those you leave behind which could mean paying off your debts and providing for childcare costs but your situation will dictate this and it can be a good idea to work out how much money is needed for things that you will no longer be able to fund if you die prematurely.
- Do not assume that joint life insurance is best if you are buying life insurance for yourself and a partner as there are many benefits to buying single life cover plans
- Consider the term of your life cover which is the number of years that it will cover you - life insurance is not an annually renewable policy usually so you'll need to look ahead to work out how long you might need for it to continue
- Most life insurance policies will include terminal illness cover that pays out your death benefit early if you have less than 12 months to live. You should check the terms of this cover within your life insurance. Terminal illness benefit is usually included at no extra cost.
- You can also combine critical illness cover with your life insurance which is an additional benefit that comes at an additional cost. Critical illness cover will allow you to claim money if you are diagnosed with a serious illness such as cancer, heart attack or stroke.
- You should also consider, putting your life insurance policy in trust to ensure that the money that is paid out if you die reaches the people you intended to benefit. Doing this can also reduce your inheritance tax on the life insurance payout if your estate falls into the levels that attract this type of taxation.
Below, we will look at where to buy different types of life insurance and what you can expect from each type of organisation where you can buy life insurance.
Where can you buy term life insurance?
You can buy term life insurance through banks, supermarkets, comparison sites, directly with insurance companies or through a mortgage broker or life insurance broker. Term life insurance is the most common type of life insurance and as such is the most widely sold. It includes level term life insurance as well as decreasing term life insurance that decreases over time to cover your mortgage.
Where can you buy whole of life insurance?
You will usually have to speak to a specialist life insurance broker* or financial adviser to buy whole life insurance. Whole of life insurance will pay out whenever you die and is a little more complex and can require guidance to buy.
Where can you buy funeral plans?
Many companies sell funeral plans that cover funeral costs, such as Churchill, Direct Line, SunLife, British Seniors and many more.
To learn more about where to buy a funeral plan, otherwise called an Over 50s life insurance, read our article, "Which is the best over 50s life insurance?"
Buying life insurance through a life insurance broker
Like mortgage brokers, life insurance brokers vary in the service and quality they provide for customers but more importantly, some will search the whole of the market while others may only search a handful of life insurance companies.
Life insurance brokers that only provide advice for life insurance as well as other personal insurance products such as critical illness cover, income protection and health insurance, usually specialise in this area of financial advice.
However, not all provide advice and some are little more than a 'middleman' that performs a search and completes an application form for you with no ongoing service.
Best life insurance brokers in the UK - with £100 cashback for Money to the Masses readers
Life insurance brokers that specialise in arranging life insurance and other personal insurance policies have an in-depth knowledge of the whole market as well as insight into how different insurance companies treat people who have health concerns, hazardous jobs or dangerous hobbies.
They guide and advise customers to buy the most cost-effective and relevant insurance for their specific needs while working within a budget that is determined by the customer. The service can include help with setting up a legal trust that allows you to nominate your beneficiaries and mitigate any inheritance tax implications on the lump sum paid out on your death to give extra peace of mind.
We have researched and vetted many such life insurance brokers and suggest that you speak with this life insurance specialist*, a life insurance brokerage with a great reputation for finding tailored solutions for any level of budget.
Many of us at Money to the Masses have used their services and have found that the advisers give great advice and find the best premiums without charging any fees. As a Money to the Masses reader, you will receive up to £100 cashback if you decide to buy your life insurance this way.
Buying life insurance through a Bank
Life insurance can be bought through your bank and usually, banks offer many financial products and services including life insurance. You will most likely find that the bank either provides its own brand of life insurance or is tied to a single life insurance provider. This doesn't provide much opportunity for price comparisons and the advice that you receive on your life insurance purchase may also be limited. For further information on buying life insurance through a bank, check out our article "Should I take out life insurance with my bank?"
Buying life insurance through the Post office
You can buy life insurance through the Post Office and the policies are underwritten by Scottish Friendly. If you buy your life insurance over the phone with the Post Office then your life insurance policy will be arranged and sold by the Post Office. However, if you buy your life insurance online with the Post Office, your life insurance policy will be sold and arranged by Neilson Financial Services Ltd.
You will only receive one price from the Post Office and this makes it difficult to compare the value of the life insurance offered to you. Additionally, while the Post Office website provides a handy life insurance calculator tool, it does not offer advice as to the suitability and so you will be left to make up your own mind about which type of cover and how much is right for you.
Buying life insurance through a supermarket
Supermarkets sell a wide variety of products and life insurance sits among the many financial products sold such as car insurance, home insurance, credit cards and loans.
However, like a tin of beans, you'll find that the life insurance that you buy through the supermarket is a basic life insurance product supplied by a third party - normally a large life insurance company - that merely has the supermarket's wrapper around it.
Again, you won't be able to compare prices for life insurance with a supermarket as you only have access to one price and supermarkets do not offer advice and guidance to help you to choose the right type, amount and term for your life cover. Do read the following article, "Sainsbury’s bank life insurance review – is it any good?"
Buying life insurance online through a price comparison website
There is plenty of content online that will inform you about life insurance but the main way to buy life insurance online is through comparison websites or directly through a life insurance provider.
Comparison websites such as Moneysupermarket and Comparethemarket will allow you to compare similar products based on the initial price of the life insurance policy you wish to buy. On the other hand, going directly to a life insurance provider will mean that you only see one price. Neither of these will provide advice about which life insurance policy you should select but can be a good place to gauge the monthly premiums for the life insurance that you want to buy if you have already worked this out. To read more about buying life insurance online, see our article "How to buy life insurance online"
Buying life insurance through a mortgage broker
Mortgage brokers vary in how they work and what they offer but the vast majority will offer to organise your life insurance while they're arranging your mortgage for you.
Some mortgage brokers can search the whole market and compare life insurance policies and life insurance quotes on your behalf. However, most will be tied to one insurance company so they only have one price to offer you or use a panel of insurers which, again may not include the most competitive life insurance cover for you. For more information, read our article, "Should you buy life insurance through a mortgage broker?"
If a link has an * beside it this means that it is an affiliated link. If you go via the link, Money to the Masses may receive a small fee which helps keep Money to the Masses free to use. This link can be used if you do not wish to help Money to the Masses and do not wish to qualify for the cashback referred to in the article
