What to watch out for

Make sure your life policy has a set term.

Your life assurance needs change over time. You may currently be the sole earner in a family with young children - if you died, they would need a hefty amount of replacement income.

But in 15 or 20 years' time, they may need very little, if anything. Whole-of-life policies, which guarantee to pay a lump sum on your death whenever it happens, are more expensive than term life policies and the premiums may also increase regularly.

Think about converting.

A conversion option lets people with term life policies convert their policy into a new one at the end of term, usually as long as they are under 60 or 65.

The advantage of this is that if they still have a need for life cover they can get it without having to undergo fresh medical tests or pay a loading for any health problems they developed during the original term. In exchange for a higher premium now, they will be guaranteed to be able to get cover when they are older.

Give up smoking.

A male non-smoker aged 36 can get €250,000, 20-year life cover for €26.92 per month, while female non-smokers aged 36 can get it for as little as €20.98. But the best their smoking equivalents can do is rates of €47.63 and €35.31 respectively.

Over 20 years, the male smoker pays €4,970.40 more than his non-smoking counterpart, while the female smoker pays a price of €3,439.20 for her habit. A non-smoker is someone who has been off tobacco for 12 months.

Check out your work benefits.

Many policyholders are paying twice for the same cover. Ifsra, the Irish Financial Services Regulatory Authority, has advised people considering buying life assurance to investigate if they have any death-in-service benefits through their employment, usually as part of a pension scheme.

This benefit may actually be enough to protect their dependants from financial difficulty in the event of their premature death.