life insurance guide

It is extremely important to know the terms and conditions of your life assurance policy. In many cases, a policyholder's personal circumstances may change during the term of the policy, and so the current premiums or the eventual amount of the payment may no longer be appropriate.

While a policyholder's personal circumstances may be likely to change, the economy itself is guaranteed to do so, and a policy taken out 20 years previously may simply no longer cover all contingencies. Some companies offer the option of index-linked policies, in which the guaranteed payout and the premium payable are linked to the Retail Price Index and rise alongside it each year.

Holders of index-linked policies need to establish whether their policies are linked automatically, or whether they need to opt-in to linkage each year; failure to do so could result in being locked out of future linking.

Furthermore, policyholders must be aware of all the rules and regulations pertaining to payouts. Some policies may not, for example, pay out if death is caused by participation in certain dangerous sports or activities.

People who receive life assurance as part of an occupational pension scheme need to ensure that cover is maintained if they leave that place of employment. If the same policy is not maintained, a new one should be started in its place as soon as possible.

It is also important to remember that the longer you put off getting life assurance, the more expensive it will get.