'Fewer young people taking out life insurance'

Young people are taking more risks with life insurance, claims research by LifeSearch.

According to internal surveys, the percentage of people under 35 who are buying life insurance has dropped by five per cent to 31 per cent.

The protection specialist claimed that young people were also making poor decisions about which products to buy with almost six times as many buying life insurance instead of protecting their income against eventualities.

Behind these decisions, which have lead to dissatisfaction with their products, is the habit of young people to seek out bargains.

LifeSearch showed that only 12 per cent of 18 to 29-year olds questioned were confident that they had chosen appropriate products for their needs. More than a third of respondents in this age group admitted that their purchase was based entirely on price.

Young people can afford to be more careful when selecting their policy because their premiums are lower than older peoples because as a rule younger people are healthier.

This research follows the discovery by BestDealInsurance that some insurers are adding extras to, or loading, insurance premiums unfairly based on medical condition.

David Thomson, the company’s chief executive, said that some companies would impose limits on cover to people whose family members suffered multiple sclerosis.

He added that twice as many insurance premiums are currently loaded as were ten years ago despite medical advances that allow earlier diagnosis and higher survival rates.