Protection products are sometimes at their most useful when they are protecting our families, our incomes or our property.
Whilst insuring ourselves against an undesirable event such as sickness or even death may not be a pleasant thing to think about, the benefit of being able to set financial issues aside at emotionally difficult times cannot be overlooked.
There are many ways in which a family can protect itself, and because of the large range of products available there is usually an appropriate policy for most circumstances, and most budgets.
Keyperson / Shareholder / Partnership Protection
Businesses may want to protect the key directors and employees within their firm – perhaps the key salesperson, or the IT manager without whom the business will not function properly. Keyperson / shareholder / partnership protection can provide a fixed sum should the individual be unable to work, or even die. The benefit will be designed to cover the firm’s expenses in meeting any emergency costs, recruiting a replacement employee and protecting the future of the business.
If a shareholder were to pass away, the firm’s remaining shareholders or directors may want protection that enables them to purchase the deceased’s shares from their estate promptly to maintain control of their business. The same scenario also applies to partners in a firm.
This type of policy is designed to provide an income in the event that the insured individual becomes unable to work due to ill health. The level of premium will depend upon the amount of benefit and term selected and most policies cease to pay the benefit once the insured is able to return to work. Income Protection policies are usually written to retirement age or 60 if earlier.
Accident, Sickness & Unemployment (ASU)ASU policies were traditionally sold to accompany mortgages, allowing for a regular income to be paid to the insured should they be unable to work due to ill health, an accident or loss of their job. The product can be split down, and unemployment cover is usually the optional extra available for an additional premium. Benefits are only usually paid for a specified time, for example 12 months. It is important to compare ASU and Income Protection closely as one may be more suitable than another. It may also be possible to use the two products to work in tandem with each other.
There are several ways in which to protect yourself and your family from the financial impact of an untimely death.
Most people take out life assurance to provide for their families and alleviate any financial worries at a difficult time.
Level Term Assurance pays a lump sum in the event of death during the term of the policy. There is no investment element within a term assurance contract so at the end of the term there is no maturity value and life cover ends. Any death claim is paid tax-free and premiums are usually monthly, and fixed throughout the term. Because the term and benefit are known from the outset, and there is no investment content, term assurance can be a cost-effective method of protection.
Decreasing Term Assurance works similarly to Level Term Assurance, but the benefit is set at outset and gradually decreases over the term of the policy. These policies can be used as cover for a repayment mortgage, or other loans where the amount of capital outstanding also decreases over time. Because the benefit reduces over time, the premiums are usually lower than for Level Term Assurance.
Family Income Benefit works the same as term assurance but instead of paying a lump sum upon death it will usually pay a regular monthly/annual tax-free income to your dependants up until the end of the term of the policy.
Critical Illness Insurance is usually available as an addition to all term assurance plans but can be bought on a standalone basis. Critical illness cover provides a lump sum benefit / income in the event of diagnosis of certain critical illnesses or medical conditions, such as heart attack, stroke, transplant, blindness, total & permanent disability and so on. The illnesses covered will be specified in the policy along with any exclusions and limitations – these differ between insurers.
Protecting your home
Whether you rent or own your home, insuring it makes sense. There are two main types of home insurance to consider – buildings and contents. As the names suggest, buildings insurance protects the property itself, whilst contents insurance covers the furniture, furnishings, appliances, clothing and all your possessions.
Whatever the type of property you live in, even if it's 'non-standard’, the chances are we'll be able to help you to find the cover you need. And we’ll also be able to help you get the right cover for all your home contents.
Although the value of properties and their contents will of course vary, it’s important not to underestimate just how much all the contents in your home are worth – your electrical and technology items alone could easily add up to thousands of pounds. ‘Gadgets’ such as tablets are small but relatively expensive and can easily be damaged or stolen. Take a look around you; how much would it cost to replace all the contents of your home?
Although we all like to think that it won’t happen to our home, unfortunately, accidents, fire, burglary and other mishaps are not uncommon. So, whilst it’s tempting to think that home insurance is one expense that can be avoided, such a decision could prove to be a false economy. The good news is that we can help.Disclaimer: No information contained within this website should be construed as advice, you should seek professional advice based on your individual circumstances.
Our specialists consultants can help in many different ways to protect your family and your standard of living when you need it most.
There are various ways in which a family can protect itself, and because of the large range of products available there is usually an appropriate policy for most circumstances, and most budgets.