People think that life insurance and critical illness cover costs more than it actually does, it has been claimed.
Most Britons believe that life insurance cover is more expensive than it actually is, it has been revealed.
According to research from a major insurer, 65 percent of people over-estimated the premiums which would be required for £150,000 worth of protection. Moreover, 35 percent made a similar error in estimating the cost of adding on critical illness cover - a form of protection which pays out if the customer becomes seriously ill.
Current figures show that a typical £150,000 policy costs £8 per month for a male non-smoker aged 25. However, researchers at Legal & General (L&G) found that one quarter of people thought it would cost between £11 and £20, while a further 40 per cent estimated the costs as being even higher.
While the actual cost of adding critical illness cover for the same customer would come to £18 per month, 14 percent thought that it would cost £21 to £30, and 23 percent put the total at £30 or above.
Karen Blatchford, commercial director for housing at L&G, 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."
The insurer also claimed that just 38 percent of Britons have life insurance.
