Insurance World

Comparison shopping for term life insurance coverage is just a click away. However, before you go around clicking on websites, there some basic information you should be prepared to provide to get preliminary quotes:

Aside from the obvious underwriting information such as your name, age and gender, you will have to provide more detailed information such as:

Weight: If your height weight ratio is not within certain limits (in other words you are overweight) it may affect your rate.

Do you smoke? Smokers pay a higher rate than non smokers. Rates can be as much as three times higher. However if you have quit smoking for at least a year prior to submitting your application, you may save some money.

Health: Companies want to know how much you exercise and what type of lifestyle you live. Do you participate in risky activities like racing, scuba diving, sky diving, rock climbing?

Type of work: Is your job hazardous? For example, if you work in underground mining, high-rise construction or work with explosives, you’ll carry a higher rate.

Driving record If you’ve been convicted of reckless driving or DWI in the last 5 years will increase your rate.

Your familial history Have your parents or siblings had cancer or cardiovascular disease before the age of 60?

You may be tempted to tell the insurance company what they want to hear (even if it’s not exactly the truth), but don’t. Lying on your application may void your insurance coverage.

Once you’ve elicited quotes from several companies, compare your rates and make sure your insurance company will be around for the long haul. Check their AM Best rating. AM Best is a company that measures the financial stability/solvency of insurance companies. A very low quote from a financially unstable company won’t do you a lot of good if they’re not going to be around to pay the claim.

You’ve probably got contents insurance for your belongings but are you aware just how easy it is to fall behind in calculating the value of them?

What do you imagine the average contents of a family home are worth - Ј25,000 or Ј30,000? In fact this figure, for a typical home, is estimated to be over Ј45,000. Apart from your “moveable items” of carpets, furniture, curtains, it’s probable that electrical goods purchased over the last few years explain the sudden rise. It’s not unusual to have three or four mobile phones, a couple of computers, possibly also a laptop. Then there are the TV’s. Apart form the large family wide screen digital HD ready, singing and dancing set, there’s probably a another one in the kitchen and two or three others in the bedrooms, not to mention DVD and video recorders. Probably the children have iPods, gameboys and whatever else is “in” at present. Don’t forget your CD collection – Norwich Union values these at Ј10 each and DVD’s.

Apart from the risk of damage, all the above items are very appealing to the thief, being easy to handle and finding a ready market. Don’t forget the garden, the mowers and garden machinery, contents of the shed and garage, garden furniture and even your tubs and hanging baskets. The value of plants can add up too!

Should you need to make a claim, it’s important that you’re not under insured. If the insurance company judges that you don’t have adequate insurance, the claim will not be fully paid. This means that if you have insured your contents for, say, Ј20,000 and your insurance company considers there would be a value of Ј30,000 to replace them, then there would be a shortfall of Ј10,000.

Insurers handle things in different ways. For example Norwich Union Direct, one of the major insurers, will pay out up to the amount for which you’re covered. It’s left up to you to fund the difference. More Than tells us that their policy on underinsured claims is to reduce them by up to 20%. In fact More

Than are taking action to ensure that clients are more up to date with their cover and so have recently increased the this for all their clients, by 25%.

These increases will apply on the clients’ next renewal dates. No doubt more insurance companies will look at following suit soon.

Whilst you’re thinking of re-assessment, maybe it’s time to check the current figures on your buildings insurance. As well as the house, garage and outbuildings, you may have fixed items such as lighting, hot tubs and permanent garden features. These are covered by your buildings insurance, not your contents. Your insurer will normally work out a quotation based on the number of bedrooms, etc., and your postcode. The insurable figure will be the cost demolition and clearing of the site and re-building your home on the present site, of course.

To help you re-consider the value of your belongings and for additional advice there’s a handy checklist for home owners on the Association of British Insurers, www.abi.org.uk

There are a large number of insurance companies handling both contents and building insurance and, as always, it pays to shop around.