Research by Sainsbury’s Life Insurance has revealed that the monthly average market life insurance premium has decreased for three quarters (74)% of customer profiles(1) over the last 12 months. The supermarket bank is urging people to shop around for their life insurance and if they already have a policy, to review their premiums to make sure they have the best cover at a competitive price.
The findings suggest that by switching life insurance provider, people may be able to pay less for the same level of cover or improve their cover for around the same premium. Furthermore, it may be possible to retain a similar premium and level of cover but receive a reward simply for switching to a new provider.
The cost of cover can vary dramatically between providers, making it all the more important to shop around for life insurance. For example, the percentage difference between the average premium of the 25% most competitive providers and the 25% most expensive was as much as 59% or £6.27 a month(1) . Meanwhile, the average premium for the most competitive providers was 21% less than the market average, or £2.84 cheaper a month(1) .
The fall over the past year follows a continuing trend of declining premiums, with research from Sainsbury’s Life Insurance in March 2007(3) revealing that monthly premiums amongst the same 38 profiles reviewed at that time had already fallen from an average of £16.11 to £15.87 (1.5%) in the space of just six months. Between September 2006 and December 2010 there has been a 16% drop in average monthly premiums.
Lucy Hunter, Sainsbury’s Life Insurance Manager, said: “Over recent years we have seen the term assurance marketplace(4)become increasingly competitive. However, the gap between the most competitive and most expensive premiums still remains significant and we believe the disparity between premiums revealed by our research should serve as a poignant reminder to people of the need to shop around.
“Life insurance is one of the most important financial products you can buy if you have dependants so it is crucial that you invest time to find the right cover for you and your family at a competitive price. A difference of £6.27(5) a month over 25 years amounts to £1,881, which is a significant amount of money that could have been used differently.”
Lucy added: “People should ideally review their premiums regularly like they might their motor or home insurance, particularly if they’ve moved home or remortgaged. Those with cover designed to help replace an income on a partner’s death should review their policies regularly, as their income and the family’s outgoings may have increased since the policy was taken out.”
Below is a table showing the research findings(1) for the average premiums of the 38 customer profiles researched:
|Market average premium||Average premium of 25% most expensive providers||Average of 25% most competitive providers||Difference in premiums between 25% most expensive and most competitive||Percentage increase between most and least competitive quartiles
|Premiums as at January 2011||£13.52||£16.95||£10.68||£6.27||59%|
|Premiums as at December 2009||£13.61||£17.39||£10.97||£6.42||59%|
|Premiums as at September 2006||£16.11||£21.07||£12.76||£8.31||65%|
Source: Moneyfacts January 2011/December 2009/September 2006
Premiums fell by on average 0.5% over the past 12 months for smoker profiles analysed, while non-smoker profiles fell by a more substantial 1.0%.
Life insurance premiums through Sainsbury’s Finance, which start from as little as £5 a month (which is 16p per day), are among the most competitive available and regularly appear in best-buy tables(2).
Customers should ensure that their chosen plan will meet their needs before they apply, and should then contact Sainsbury’s Finance for a quote or further information on 0800 027 7166(calls may be monitored and recorded). Further information is also available at www.sainsburysfinance.co.uk or at Sainsbury’s supermarkets. Sainsbury’s Finance does not offer financial advice.
For further information, please contact:
Phil Anderson/Georgiana Brunner
Citigate Dewe Rogerson
020 7638 9571
Notes to Editors:
(1) Sainsbury’s Life Insurance commissioned Moneyfacts to review whole of market life insurance premiums (level term only) for 38 different risk profiles (various ages, male & female and term as well as smoker vs. non-smoker) in January 2011 and December 2009. Findings look at difference between the 25% most competitive and the 25% most expensive insurers.
(2) Sainsbury’s Finance Life Cover (Level Term Assurance and Mortgage Decreasing Term Assurance) is provided by Legal & General Assurance Society Limited. The cost of life cover will depend on the customer’s age, term of the policy, options selected and state of health.
(3) Sainsbury’s Life Insurance commissioned Moneyfacts to review whole of market life insurance premiums (level term only) for 38 different risk profiles on 16th September 2006 and 20th March 2007 findings look at difference between the 25% most competitive and the 25% most expensive insurers.
(4) 38 risk profiles reviewed
(5) The percentage difference between the average premium of the 25% most competitive providers and the 25% most expensive was as much as £6.27 a month.
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Sainsbury’s was the first major British supermarket to open a bank, commencing trading in February 1997. Benefiting from a fantastic, trusted brand that enables us to combine the shopping experience with personal finance, Sainsbury’s Finance provides a range of quality products including insurances, credit cards, savings and loans. Our proposition is to make shopping more rewarding by offering customers great products at fair prices, while consistently rewarding shoppers for their loyalty and being easy to do business with at all times. Our products consistently top Best Buy tables and regularly win awards for quality, price and service.
Sainsbury’s Finance recent awards include Best Overall Online Provider, Best Direct Personal Loans Provider, Best Online Credit Card Provider, Best Online Life Insurance Provider, Your Money 2010
Sainsbury’s Finance is a joint venture between J.Sainsbury plc and Lloyds Banking Group.
For further information and general Sainsbury’s Finance enquiries customers can call the freephone number on 0500 40 50 60 or visit www.sainsburysfinance.co.uk
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