The best life insurers

There's more to think about than price when picking a life insurance policy

Working out which insurer to go with should always be about more than simply price.

It’s not enough to bag a cheap premium: you need to know exactly what’s covered, what the claims process is like and how likely you are to actually get a payout.

Protection adviser firm LifeSearch has announced the winners of its 2015 awards, which give us a decent insight into which firms offer more than just a good price. The awards are primarily voted for by LifeSearch protection advisers.

Let’s take a look at who walked away with gongs on the night.

Best service for new customers: LV=

Best provider for existing customers: Ageas Protect

Most improved provider: Friends Life

Best critical illness provider: Friends Life

Best underwriting team: LV=

Best overall provider: LV=

Defaqto rankings

Another ranking system work a look is the financial information firm Defaqto's life insurance star rankings system.

When calculating the star ratings for direct life insurance policies, Defaqto looks at the following things:

Financial strength – as if the insurer is financial stable, you can be more confident that your cover will remain in place for the duration of the term.

Annual statements issued – these are an important reminder of what type of policy and how much cover is in place.

Point of sale decision given – does the insurer give a prompt decision and firm price straightaway when you have decided you want to take out cover?

Life cover guarantee rates – will your premiums remain fixed throughout the term?

Varying terms – do you have the option to increase or decrease the term of your policy?

Varying sum insured – do you have the option to increase or decrease the amount of cover you have?

Free cover during underwriting – underwriting of the policy itself can take some time, but many policies offer cover during this process

Helpline – is there a helpline available so that policyholders can quickly get information about their cover when necessary?

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The best life insurers

With that in mind, let’s take a look at the life insurance policies that managed to secure a five-star rating.

Just four policies from two different insurers managed the top rating: Aviva with its Life Insurance (Simplified) and Term Assurance policies, and Legal & General with its Multi Protection and Level Term Assurance policies.

Securing four-star ratings are Aegon’s Personal Protection, LV=’s Flexible Protection Plan, two Protection for Life policies from Scottish Widows (one of which includes critical illness cover and one which doesn’t) and two life insurance policies from Tesco Bank (one of which includes critical illness cover and one which doesn’t).

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Picking the right life insurance policy for you

Rating systems like Defaqto’s are a helpful guide, but they aren’t a reason to blindly go with one of the five-starred insurers.

You can get a tailored life insurance quote via the life insurance centre. But before you can get a quote, you need to know exactly what type of life insurance you want.

The different types of life insurance

Life insurance comes in many forms, but there are three main types:

Level term assurance: your level of cover stays level for the full term of your policy;

Decreasing term assurance: your level of cover decreases over time (popular with mortgage holders);

Family income benefit: your loved ones receive a regular income when you die, rather than a one-off, lump sum. Works out cheaper than normal life insurance.

There are plenty of other questions you need to answer too in order to establish the right policy for you, such as the amount of cover, the term of the cover and whether to get a joint policy. For more, read Life insurance: how much do you really need? and How to get the best life insurance policy.

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This article has been updated

More on life insurance:

Life insurance: how much do you really need?

Who needs life insurance?

How to get free life insurance


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