Aig Term Life Insurance - Affordable Fixed-Term Protection UK

How AIG's term cover works

AIG's term cover runs for a fixed number of years, pays a defined sum if death occurs during the term, and ends with no value at the end. Most UK term policies — AIG's included — offer level term (fixed sum assured) and decreasing term (sum reduces, typically for mortgage cover); some offer increasing term indexed to inflation.

Pricing on AIG term cover depends on age, smoker status, sum assured, term length and declared medical history. For standard-rate profiles, AIG prices competitively against the rest of the market; for medically-loaded profiles, the spread between insurers widens materially and a broker comparison is typically worth more than it is on a straightforward application.

What drives the price of a AIG policy

AIG's pricing, like every mainstream UK insurer's, is driven primarily by age, smoker status, sum assured, term length and policy type. Health disclosures are next — BMI, declared medical history, occupation and any family history of the major hereditary conditions. None of this is unique to AIG; what differs between insurers is how each input is weighted in the final premium.

Two structural realities apply to any AIG quote: premiums rise year-on-year with age (so delaying meaningfully costs money), and pricing spread between insurers on the same profile often exceeds the year-on-year age increase — which is why comparison across insurers usually beats loyalty to any one brand.

AIG vs comparable UK insurers

AIG competes with roughly a dozen mainstream UK life insurers — Aviva, Legal & General, Royal London, Zurich, Scottish Widows, LV=, Vitality among the larger ones. The differences that matter: pricing at specific profiles, underwriting appetite on medical history, waiver of premium terms, and, for CI, the partial-payment schedule.

For a concrete decision: a whole-of-market broker will surface three or four quotes — AIG may or may not be among the cheapest for any given application, and the only reliable way to know is to see the number next to two or three competing numbers on the same profile.

What AIG looks at when a claim is submitted

When AIG receives a claim, the assessor follows the standard UK insurer process: verify the policy was in force, request and review GP records to check application accuracy, and confirm the cause of death isn't specifically excluded on the schedule. Claims that pass all three checks — the vast majority — are paid within 4–8 weeks.

The claims that don't pay at AIG almost always share the same pattern observable across the rest of the UK market: material non-disclosure on the original application, or a claim that falls inside a named exclusion. Both are pre-application decisions. An advised application with pre-underwriting typically prevents both.

How this looks in practice

A 45-year-old with declared but well-managed hypertension applies for a £300,000 combined life-and-critical-illness policy with AIG. After full underwriting the insurer offers cover at a ~25% loading on the critical illness component. Seven years later the policyholder is diagnosed with a stage 2 cancer that meets the ABI severity definition: AIG pays £300,000 tax-free and the policy ends. The original loading cost a small amount per month; the payout is what the product was bought for.