Two-thirds of People Over-Estimate Cost of Life Insurance, Say Legal and General

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Legal and General research has shown many may avoid taking out life insurance due to it being to costly.

Life cover can start from as little as £6 per month, which even families on a very tight budget may be able to afford. We're concerned that two-thirds of people are over-estimating the costs of protection.

Legal & General is concerned that people might avoid taking out protection because they think that it is too expensive. 65% of people recently polled by Legal & General over-estimated the cost of taking out £150,000 worth of life cover. 35% over-estimated the cost of adding a critical illness option to that life cover.

Karen Blatchford, Commercial Director for Housing at Legal & General said: "Life cover can start from as little as £6 per month, which even families on a very tight budget may be able to afford. We're concerned that two-thirds of people are over-estimating the costs of protection."

£150,000 level term assurance over 25 years for a healthy, non-smoking man aged 25 would cost just £82 per month. 24% of people that
Legal & General questioned thought that it would cost between £11 and £20, 18% thought that it would cost £21 - £30 and 22% thought over £30.

Adding critical illness cover for the 25 year old man would cost a further £18 a month. 14% of people that Legal & General spoke to incorrectly estimated between £21 to £30 and 23% said it would be more than £30.

Karen Blatchford adds: "Just 38% of the people we surveyed have life insurance, which is cause for concern. People may wish to consider covering not just their mortgage debt, but their family expenditure and bills. Most families would really struggle if there was an unexpected drop in the household income."

Notes to Editors:

1. All figures, unless otherwise stated, are from YouGov Plc. Total sample size was 1,964 adults. Fieldwork was undertaken between 18th - 21st July 2008. The survey was carried out online. The figures have been weighted and are representative of all GB adults (aged 18+)
2. Based on Legal & General Direct rates. Correct as at 15 August 2008. Assumes applicant is healthy and therefore based on standard premiums.

  • This press release is issued by Legal & General Partnership Services Limited. Registered office: One Coleman Street, London EC2R 5AA.
  • The information contained in Legal & General's press release is intended solely for journalists and should not be used by consumers to make financial decisions.

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