Life and protection insurance policies are designed to protect you and your family from the financial consequences of death or a serious accident or illness.

Far from being a luxury, protection insurance should be considered essential, especially if you have a family or people that rely on your income.

If you suffered a serious illness or injury, you may lose your income – this could lead to you losing your home. Similarly, if you died, would your loved ones be able to maintain their current lifestyle without your income?

You may already have life and protection insurance in place, but it’s still worthwhile reviewing your current cover levels. Personal circumstances can change regularly so it’s important to ensure your level of cover is appropriate.

​

Why is it important?

If you or your family faced a similar situation, a protection  policy could help to:

• Pay off your mortgage

• Maintain your or your family’s lifestyle

• Pay for replacement childcare

• Cover school or university fees

• Pay for specialist nursing support

 

LIFE ASSURANCE

​

What it does. Life insurance (sometimes known as life assurance) will pay out either a single lump sum (sum insured) or a regular income to your beneficiaries when you die. It can help provide financial security for people who  depend on you, if the worst happens.
Why you might need it. Although money can’t replace a loved one, it can help those left  behind to weather the financial storm. For example, it could pay  off the mortgage or provide an income to help cover regular  household expenditure.

 

There are different types of  life insurance - the most appropriate type for you will depend on your circumstances

1.  Term insurance 

This is the simplest type of life insurance. You choose  how long you’re covered for, eg. 20 years (the term),  and the policy pays out if you die within the agreed term.  You can also take out term cover as a couple, with the  policy paying out on the first death only during the term. 

 

There are several different types of policy:

• Level: The amount of cover and premiums remain the same

• Increasing (or index-linked): The amount of cover  and premiums gradually rise in line with inflation

• Decreasing: The amount of cover gradually reduces.  Generally used to protect a repayment mortgage where the amount of the loan outstanding reduces each year. It is the intention to cover the loan however upon increased interest rates there is no guarantee there will be enough cover upon claiming.

• Renewable: You can extend the original term of the policy

• Convertible: Lets you convert the policy to whole of  life insurance

​

2. Family income benefit insurance 

This is essentially the same as term insurance, but instead  of paying a lump sum when you die, it will pay out a regular  income instead. This type of payment may be more suitable  where the main purpose of the policy is to provide ongoing  financial support to dependants.

 

3. Whole of life insurance  

Whole of life insurance pays out a lump sum when you die, whenever that is, as long as you are still paying the premiums.

​

Critical illness protection

​

What it does. Serious illness and critical illness insurance plans pay  out a tax-free lump sum on the diagnosis of a range of serious conditions. These conditions include  things like heart attack, stroke, cancer, major organ transplants  and many others. The conditions covered will vary depending  on the insurer.

Serious and critical illness insurance often comes as an optional addition to a life insurance policy, but can also be purchased on its own. Policies usually only pay out once, so they don’t necessarily replace your regular income, but you can use the money towards medical treatment, your mortgage or anything else you choose.

Why you might need it. Many people buy serious and critical illness insurance when  they take on a major commitment, like a mortgage, or start a  family. However, since we’d all like to have our financial  commitments lightened if we were to suffer a serious illness  or injury, the cover is relevant for most of us at any time.

​

Look beyond the price. It may be tempting simply to opt for the cheapest policy available.  But it is important to bear in mind that whilst many products may  look the same, there can be important differences between them  that can be difficult to spot.  
 
This is particularly important with serious and critical illness cover,  and income protection insurance, where the cover available from different providers varies more significantly. Care should be taken to select a policy that is most suitable for your particular needs.  We can help you make the right selection.

​

THE PLAN WILL HAVE NO CASH IN VALUE AT ANY TIME AND WILL CEASE AT THE END OF THE TERM. IF PREMIUMS ARE NOT MAINTAINED, THEN COVER WILL LAPSE.