AA Muscles in on Life Insurance

The AA has announced that it is to branch into life insurance, increasing its already impressive financial services portfolio.

This is a logical progression as the group is the UK’s largest car, home and travel insurance broker. They hope to be able to offer level term life insurance and mortgage protection policies from October 1 st.

Policies will be sold on behalf of a panel of life insurers and the group claim they will be able to provide customers a quote within 30 seconds. This should be possible as consumers will begin their application online after which they will be contacted by phone by an underwriting specialist who will then complete the application.

As the group sells other types of insurance, it hopes to exploit its strong reputation and trusted brand name by selling a product that many find difficult to understand.

The firm aim to be not just competitive but one of the cheapest in the market place, with premiums starting at just £6.82 a month for £100,000 cover based on 35-year-old non-smoking female.

Kevin Sinclair, managing director of AA Insurance, said, “Many people find applying for life insurance confusing and tend to put off buying decisions.

“We aim to make the process as quick and easy as possible with premiums among the cheapest available.

“While most people are happy to insure their home and car, they could do more to protect the people closest to them, should the worst happen.”

According to the group, a quarter of homeowners admitted they did not have adequate insurance cover to protect their mortgage if the main earner in the household died, with 72% admitting they would lose their home as a result.

Life insurance has recently been in the spotlight with insurer Prudential claiming that half of workers approaching retirement age have not saved sufficient funds to provide for their retirement.

Over 50% of over 50’s are paying off personal debt when they should be saving for retirement, says Prudential. One of the main reasons for this, the group said, was poor financial planning.

With so many Britons struggling with debt and failing to provide adequate funds for retirement, it is now a major concern that many will lose their homes if one of the major earners in the household dies.

With bankruptcy declarations on the rise and the UK’s debt problem showing no signs of abating, all the signs are there that the UK’s population has to start planning financially for the future as well as the present.