With Lentil due to be born any day, and after lengthy discussions, we decided life insurance might be a good idea.
What started out as a good idea has rapidly become a major headache. It turns out that life insurance comparison quotes are nothing like that of car insurance.
With cars you simple head over to whichever brand of comparison you prefer, tell them your details, what car you have, where you live, and what your use is, and out comes a quote and that’s the price you pay.
Which life insurance you tell them your name, where you live, and what payout you want for death and if required critical illness and they give you a “quick quote”. This is nice and easy. However this is based on various assumptions relating to your health. We both quote these quick quotes at about £13.00 per month based on our needs.
Once you head over to the site to actually buy this quote you are presented with a massive health questionnaire: Have you ever had this? Have you ever had that?
Most of it is fairly straight forward, for example: neither of us have ever had a stroke or a heart attack, neither of us are overweight, or drink excessively. Where is gets complicated is when I answer the questions relating to depression, self harm and suicide, and where the questions for Buttercup are answered in relation to both of her parents having had cancer.
The first 3 companies I tried flat out refused to insure me because I have had depression and have self-harmed and been suicidal at some unspecified point in my life. Rather than ask any follow up questions relating to this, they just declined me. The third company I tried, did ask a few follow up questions, and it appears that once they were told that actually all this stuff happened over 5 years ago, they were ok with it. My premium increased a little from the initial £13 to £15, but this is a small price to pay. I understand how insurance risks work given that I work in the insurance industry (albeit cars not life, but same overall principal).
Buttercups application was similar. The first 3 (same companies as me) have put her on a “pending” decision, so while we wait for that I went to that fourth company for me, they again asked a few extra questions and again decided they will accept Buttercup, but at an increased premium of £20.
It would appear that the aforementioned assumptions are that you are perfectly healthy, you have never had any health issues (physical or mental), and neither have your family. Which if this is the case you absolutely can get the cheapest premium they offer. Except, and not to be too blunt, or put too fine a point on this, who hasn’t had depression at some point, who hasn’t had cancer in their family somewhere.
On closer inspection the life policy itself is not too expensive, both are about £6 a month, its the critical illness cover which really does it.
Lets be honest, we all know insurance is a bit of a con at times. My 21 year policy at £15 a month will cost me a total of £3780 which assuming i don’t get any form of critical illness and I don’t die in that time (which I really hope I don’t, naturally), will result in a lot of money spent for nothing. On the other hand putting that money in to savings over 21 years would not ever accrue enough interest to result in a quarter million pound payout upon my death. So I guess its worth it.
Ultimately we are protecting our child’s future more than anything else. Can you really put a price on that?