What is the difference between guaranteed & reviewable premiums?
With a “Guaranteed” policy the insurer guarantees to never raise your monthly premium. With a “Reviewable” policy your insurer reviews its premium at regular intervals – usually interval of between 1 and 5 years. This interval does vary between companies and you should check their literature. At the Review date, your insurer has the right to increase your premium and as you get older, increases will become larger. As you might have expected, at the outset when you start a policy, the premiums for “Guaranteed” policies are higher than the premiums for “Reviewable” policies. However, through the review system the premiums for Reviewable policies can soon catch up and overtake. In the medium to longer term we believe that Reviewable policies will work out more expensive than Guaranteed policies. On the other hand Reviewable policies do have the advantage of a low start up premium and this appeals to many people, especially if budgets are tight.
