Protection

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Protection

Thinking about the consequences should anything happen to the main breadwinner isn’t something any of us want to contemplate. However it is important when arranging your mortgage to take the time to protect you and your family should the unthinkable happen.

Put simply protection products are policies that are arranged to provide you and your family with either a lump sum or a regular income should you become seriously ill, or in the event of your death.

We have listed some of the most popular types of insurance below:

Life Insurance

What is it?

A Term life insurance plan is the most basic form of life insurance and is usually the cheapest way to insure your life. It covers you for a fixed period and pays out a one off lump sum if you die during the policy term.

With some term insurance policies you can add additional options, for instance critical illness cover. If you do add on critical illness cover, the plan will pay out once on diagnosis of a qualifying critical illness or if you die during the term of the policy.

Who is it for?

This type of plan is designed for those who want to leave a lump sum in the event of their death within a specified time period whilst keeping the cost to a minimum. Term assurance can protect your family from the financial implications of a personal tragedy and is particularly important if you have young children or dependents.

 

It can be used to cover a mortgage, other loan or to ensure that your family is protected from the effects of having to repay a debt after the main breadwinner has passed away. As Professional Advisors we can help you find the plan that best meets your requirements.

Critical Illness Cover

What is it?

A Critical Illness plan is designed to pay out a lump sum on the diagnosis of certain specified illnesses. It is often ‘bolted on’ to a life assurance policy as an additional benefit but can also be a standalone plan. Where is differs from life insurance is that you do not need to pass away for the policy to pay out and it covers significantly more scenarios than just life insurance.

The most claimed areas of critical illness policies are Cancer, Heart Attack, Stroke and Multiple Sclerosis. However, the better polices on the market can cover you for as much as 60 illnesses. It’s also important to mention that the better policies on the market also make it easy to make a claim which is a really importnant consideration when taking out a policy.

 

Who is it for?

This type of plan is designed for those individuals or families who want a lump sum if they are diagnosed with a serious illness. As an example of where this lump sum could be used is to repay a loan, mortgage, or perhaps pay for time off work. The lump sum could even be used to pay for any necessary alterations to your home. 

The quality of cover and the illnesses covered can vary significantly between different providers. As advisors we can help you find the plan that suits your requirements.

Income Protection

What is it?

An Income Protection plan is designed to pay out a regular income in the event you are unable to work due to an accident or illness. These types of plans continue to pay out an income as long as you are unable to return to work up until the end date of the policy (typically your normal retirement age).

This type of plan is quite often seen as the foundation of any financial planning as it is likely that other plans will have to be given up if you do not have sufficient income coming into the household.

Who is it for?

This type of plan is designed for anyone whom is working (employed or self employed). It’s worth pointing out that even if your employer provides sick pay, it is unlikely to last for longer than twelve months and so ongoing protection is essential.

Plans can be adapted to fit in with any existing protection you might have. As advisors we can help you find the plan that suits your requirements.

Mortgage Payment Protection

What is it?

A Mortgage Payment Protection plan is designed to ensure that you are able to continue to make your mortgage (and other related expenditure) payments in the event of accident, sickness or unemployment. It is often referred to as Accident, Sickness and Unemployment cover or ASU. These plans usually pay benefits for up to two years however, if you are seeking a plan that pays for a longer period, then Income Protection Insurance is generally more suitable.

It’s worth noting that there is currently no legal requirement to have such cover and potential mis-selling of these products has generated much interest from the media and the industry regulator in recent years. However, this doesn’t mean that they are not right for some people and can provide valuable protection in the right circumstances.


Who is it for?
This type of plan is designed for those who are worried about being able to continue their mortgage payments in the event of losing income due to accident, sickness or unemployment.

It is extremely important that you take financial advice before taking out this type of plan as they are not always the best nor cheapest option.

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