Level term life assurance

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Hello, I had Papillary Thyroid cancer, stage 1, with complete Thyroid & Parathyroid removal & radiotherapy in 2012. Unfortunately, I’m having major problems trying to get Life insurance; every time I do a search, as soon as I disclose I had cancer in the past, albeit 12 yrs ago, I’m told that no policies are available for people with a history of cancer. I’d like a level term policy with critical illness, as I still have a joint interest only repayment mortgage & we’ll need to  change it to a repayment or over 55 mortgage within the next few years. Are there any insurance companies that will accept me for life assurance please?

  • Hello @Podgirl,

    Thank you for getting in touch. I’m glad to hear of your treatment and subsequent recovery from your cancer diagnosis, however sorry to hear that you are having difficulties with getting suitable life cover. Unfortunately, I am not able to recommend any specific companies, but have included some information that will hopefully be useful in trying to find the right cover.

    A cancer diagnosis, or any other serious medical condition, is likely to make getting life cover much harder.  As you’ve experienced, the application will normally require a more rigorous underwriting process, requiring medical reports and sometimes an examination.


    It’s important to remember that insurance companies look at ‘risk’ when assessing an application and will consider the likelihood of a claim during the term of the policy. If the insurance company believes that this risk is higher than average, they might accept the application, but increase the premiums. If cover is refused, like you have experienced, it may be worth speaking to an Independent Financial Adviser who will be able to search the whole of the insurance market for you. Maybe check with family and friends to see if they can recommend an adviser.

    Alternatively, visit http://www.thepfs.org/yourmoney/find-an-adviser/ to find details of advisers in your area.


    When choosing a financial adviser, always check that they, and the company they work for, are authorised by the Financial Conduct Authority (FCA) to provide financial advice.

     

    This information can be found on the FCA register:

     

    https://register.fca.org.uk/s/

     

    Please be aware that, if an unregulated firm (or individual) is used, there may be no protection from the Financial Ombudsman Service or Financial Services Compensation Scheme if things go wrong.

     

    Another website which you may find useful is the British Insurance Brokers’ Association (BIBA). They have a created an insurance directory which can be used to search for life insurance for anyone who has a pre-existing medical condition.

     

    The link to their directory is below, there is an option to search for life insurance for people with medical conditions:  

     

    Find Insurance - BIBA

     

    * Please note Macmillan does not endorse any particular company or product that may be advertised on BIBA website.  

     

    It’s also worth thinking about life cover that you may already have in place, or is accessible through an employer? Some employers offer life and/or critical illness insurance as part of an employee benefits package, either as a stand-alone policy or as part of a pension scheme. This cover is generally available without medical checks and is usually a multiple of an employee’s salary.

     

    Please note that in providing this information, Macmillan cannot give advice about life assurance, cannot guarantee that an individual will be able to obtain cover and does not endorse any specific life assurance company or product.


    As you mentioned some concerns regarding your interest only mortgage, I have included some information in regard to planning ahead for interest only mortgages, which I hope you will find helpful.

    It can sometimes be a worry about how to pay back the balance of an interest only mortgage at the end of its term. 

    It’s always important to speak to your mortgage lender as soon as possible.

    Options your lender may suggest include:

    • Converting the entire mortgage to a repayment mortgage over the existing term. This option guarantees that the debt will be repaid by the end of the term, although it will increase the monthly repayments.

     

    • Converting the entire mortgage to a repayment mortgage and also extending the term. This option gives a longer period over which to repay. This also ensures the mortgage is paid back by end of the term, but the monthly payment will be lower than the first option.

     

    With the potential options above, it will be helpful to undertake an income and expenditure exercise. This helps to work out how much disposable income can be allocated towards repaying your mortgage, or to identify any savings that could be made in other areas.

     

    The budget planner available on our website may help you with this: http://finance.macmillan.org.uk/budget-calculator

    • Save into an investment product to cover the shortfall, e.g. a stocks & shares ISA or another investment plan. An adviser can help choose the most suitable plan and work out what would need to be saved in order to meet the target amount needed.

     

    • Pay off some of the mortgage debt each month or make lump sum payments to reduce the debt and narrow the shortfall. This allows the flexibility to pay as and when it’s affordable. But, it’s important to check with the lender to see if there are any charges related to this option. Also, ask when the benefit will be allocated from the extra payments – some lenders only apply an overpayment once a year, so it’s important to time these accordingly.


    With any of the above options it’s important to think about how much mortgage debt is remaining and how long is left until the mortgage term ends. Remember to factor in any interest and bear in mind that the value of investments can sometimes rise as well as fall. This will help to plan accordingly.

    Other Options

    Equity release

    Equity release describes a range of products only available to those who are typically over the age of 55, as you mentioned. They allow people to release the equity (cash) tied up in their home. The products have no fixed term and allow the homeowner to stay in their home for the rest of their life, unless they have to move into long term care.

    These schemes can be helpful in certain circumstances, but aren’t suitable for everyone. For example, they can be expensive and inflexible if circumstances change in the future and they may affect your current or future entitlements to state or local authority benefits.

    Downsizing

    Selling and moving to a cheaper, or rented property may allow some people to clear some, or all of their mortgage debt. But, it’s important to be aware that house prices can go both up or down and it’s not always easy to sell a property. It’s also important to remember that circumstances can change and not everyone will still be able to or want to sell their home in the future.

     

    I hope you’ve found this information helpful.

    Just to let you know, our Financial Guidance Team can offer information and guidance on all aspects of your personal finances to help you make informed decision in the following areas:

    • Pensions and retirement options
    • Questions about insurance policies
    • Mortgages and money management
    • Arranging wills and trusts to protect your family
    • General financial planning questions

    You can call us on 0808 808 0000, selection Option 1, then 2 and then 1 again and we are open Monday to Friday from 8am to 6pm. Alternatively you can also speak to us between the same hour on Webchat.

    Laura

    Service Knowledge & Content Specialist

    The Financial Guidance Service will not recommend that you buy, sell or cancel a specific financial product from any company. As a guidance service, we do not provide financial advice and we are not regulated by the Financial Conduct Authority

    The aim of the Financial Guidance Service is to provide you with the information you need to make informed decisions about your personal finances. For financial advice, including recommendations to buy, sell or cancel specific financial products, you should speak to a financial adviser who is suitably qualified and regulated by the Financial Conduct Authority.

  • Thank you so much for your info. you’ve been so helpful, I actually feel I might be able to change things! Again, thank you so much.