More than 20 million Spaniards are protected by life insurance. In this article we compile this and seven other interesting facts about these policies, in case you have not yet decided to take out one.
Life insurance policies take care of a household’s finances. In case something happens, they take action and pay compensation to the loved ones of those who take them out. Their operation is simple and they are very useful. If you have never considered having one, perhaps it is because you do not have much information about them. Here are eight interesting facts to convince you, with information from Unespa (the sector’s employers’ association) and figures from independent reports.
1. More than 20 million Spaniards have a life insurance policy
In 2020, there were some 20.7 million people with life insurance in Spain. Specifically, just over 15 million had an individual policy and another 5.6 million were in a group insurance policy. Bearing in mind that, as of January 1, 2021, there were 47.3 million people in Spain, we can conclude that 4 out of every 10 residents in our country are protected by one of these products.
2. 1 out of every 6 people who die in Spain has one.
In Spain, between 65,000 and 70,000 people who had one of these life insurance products die each year. This means that 1 out of every 6 people who die leaves an indemnity to their loved ones.
3. Each year they pay off 4700 mortgages
Mortgage life insurance policies ensure that, in the event of the death of the policyholder, the compensation is used to pay off the debt owed to the bank. Thus, each year they pay off some 4,700 mortgages, so that these families do not have to continue paying after losing one of their members.
4. In 2020 they paid more than 1275 million euros to Spaniards.
The hope of any person taking out one of these policies is to never need it. However, as the figures in the previous point show, misfortunes do happen. In 2020, in which there were 17.7% more deaths than in a normal year, life insurance paid out some 1275 million euros in indemnities. This figure is 6.25 % more than in the previous year.
In addition, the money paid out by companies to their policyholders has been growing over the years. For example, between 2015 and 2020 alone, they have paid out 16.9% more in indemnities. The reason is simple: more and more Spaniards are choosing to protect themselves with these products.
5. 42% of life insurance policies are temporary renewable.
There are different types of life insurance. The most common (and recommended) are temporary and renewable. In general, these policies are taken out for one year and, if the client is happy, they are automatically renewed. They are the most recommendable option because they allow you to modify the characteristics easily, without tying you for years and years to the same company. If you don’t like it, all you have to do is change.
So, you should always avoid the so-called single premium insurance. They are those in which you pay for many years at once, forcing you to pay thousands of euros at the time. Not only are they more expensive, but they do not allow you to modify their characteristics and, of course, they are very difficult to cancel. Fortunately, they are becoming less common, although some banks still sell them.
6. Most of them have an annual premium of less than 300 euros.
Life insurance is not expensive. In fact, most have a premium of less than 300 euros per year. And you can get yours for much less than that, if you know where to look.
The premium is set according to several factors, but three are the most important: your age, the capital you want to take out and the coverage you add.
In our comparator you can quickly see what the main companies in the market offer you. You only have to enter your age and the capital you want as indemnity; or, if you prefer, the annual budget you have set yourself. With this information, you will see the prices, coverage and requirements of the major companies, compare them and even hire them on the spot.
7. Life insurance from banks are up to 93% more expensive
We have already said that life insurance is not expensive. That is why this fact is even more striking. Taking out one of these policies with a bank can be almost twice as expensive as if you do it with a specialized company. This was demonstrated by an independent study, with data from 2021, which compared the prices of several banks and insurers. A product that should cost 360 euros, becomes worth 694.03 euros, for example, despite having the same features. Therefore, the best trick to save money is to turn to expert companies in the sector.
8. Only 3.9% of policyholders died after paying more than 30 years of insurance premiums
It pays off, and a lot, to have life insurance. Maybe you are one of those who think that it is not worth paying years and years for a product that you may never need. If you think that, after paying for a long time, it is possible that you have given more money than you will receive as compensation, this information is of interest to you.
In 2019, only 3.9% of policyholders died after paying 30 years. In fact, 3 out of 10 died less than 5 years after doing so. In reality, it is unlikely to need one of these policies, since, fortunately, few people die prematurely. However, when it is needed, it usually pays out more money than was paid in premiums.
If you have not yet decided to protect yourself and your loved ones, remember these five facts about life insurance. They are products that already protect millions of Spaniards, for very little money per year and that can be very useful for a household when the time comes. Take a look at our comparator and find out for sure: protect your future without paying too much.