Life Insurance Premiums

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Lifetimes

Guest
I have a life insurance policy for quite a number of years. I am now advancing in years and for the last few years the insurance company has been increasing the premium on the policy at an alarming rate. They maintain that this is because I am becoming a greater risk as I get older. I have looked at reducing the premium by reducing the amount of cover. The insurance company say this is ok but that if I subsequently want to increase the cover/premium I will have to do a medical test.
I suspect the insurance company in reality wants me off their books to avoid a payout.

My questions are:
1 Have I any redress against this? Would the insurance ombudsman be interested in the case?
2 If I reduced my cover/premium now but later on my circumstances changed would I be obliged to do a medical test if I wanted to increase my cover.
 
Do you need life assurance cover? Do you have dependents that would need to catered for should you predecease them?
 
When you take out cover when you are younger the costs should be lower as it is less likely there are medical complications. If you take out cover when you are older the premiums will be higher due to a combination of age and increased risk. It is also more likely that you will be asked to attend a medical. Your premiums will increase on renewal regardless of whether you amend your current cover or not. If you decide to increase your life cover, although they may waive the medical, you can expect your premiums to increase substantially to cover the increased risk.

The choice you were given by your life assurance company/broker to decrease cover to match your monthly life cover premium allowance is fairly standard.

Have you asked over what term they are quoting? I'm guessing its a whole of life policy? If they are reviewing over a minimum number of years it might keep the premium down but for that period only. The advantage is that it may keep the policy open with the sum assured remaining. Whether they do that is dependent on the T&Cs of your policy and the company's renewal policy. It is also likely that you are being quoted for a minimum term already.

Do you have additional benefits on your current plan? Can you get a breakdown of your premium to see how much is going into life cover v additional benefits etc?

Your decision will really be based on whether or not it would be easy to obtain life cover now and for your required term. There are different products on the market which may suit your needs. Its a good idea to shop around to help make a decision regarding your current policy. If life cover is a definite requirement and you find a better product for your personal circumstances, ensure you have another policy in place before cancelling any existing policy.
 
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