Nearly half (44%) of UK workers overestimate the monthly cost of income protection, life cover, and cash plan policies*. This highlights a significant gap between perceived cost and reality, meaning many are missing out because of misperceptions around price.
Life cover pays out a lump sum in the event of your death, while income protection pays a percentage of your salary while you recover from an illness or injury. A cash plan is an insurance policy that can help to cover the cost of everyday healthcare, such as visits to the dentist, opticians or physiotherapy, by reimbursing you for some or all of the cost of routine and/or unforeseen healthcare costs and appointments.
A change in circumstances could leave you unable to meet your monthly payments, unless you’re covered by a specialist insurance product. The Financial Conduct Authority's (FCA) Financial Lives survey, published June 2020, showed how many UK borrowers would struggle with mortgage repayments if a breadwinner died or had a long term illness**. The FCA found that over half of all adults (53%) did not hold any protection products with the 18-24 age bracket being among the highest.
Families do need to discuss their protection needs when they have a mortgage. No one can be sure what life has in store for us, that’s why it’s important to have in place plans that would provide financially for you and your family should the unexpected occur.
Some of our products we can protect you with:
Mortgage term assurance
This is a form of cover which provides a lump sum in the event of death. This type of life insurance is a form of decreasing cover, which only pays out whatever is outstanding on the mortgage. If you are buying your house as joint owners you can choose to have the mortgage pay out on “first death basis” meaning if one of you dies, the mortgage is paid off.
Critical illness
You can include this cover in your life insurance policy or have it as a separate cover. It pays a lump sum if you’re diagnosed with a long-term critical illness.
Income protection
Income Protection Insurance helps support you financially if you have time off work and suffer a loss of earnings because of injury or illness.
Income protection can pay out on a range of illnesses that prevent you from working – it doesn’t have to be critical. Income Protection Insurance only covers you if you’re unable to work due to illness or injury –it does not pay out if you are made redundant.
Accident, sickness and unemployment (ASU) insurance
ASU cover can help you keep up with your rent or mortgage payment and other outgoings if you are made redundant or you’re too sick to work for short period of time (between1-2 years). Some ASU policies can pay a fixed sum in the case of you or a family member suffer from broken bones.
An insurance policy could provide you with valuable peace of mind during these turbulent times, and we’re here to talk you through both the product options available and accurate costings.
SPEAK TO AN ADVISER
Source:
* https://www.the-exeter.com/news/44-of-uk-workers-overestimate-the-cost-of-income-protection-life-cover-and-cash-plan-policies
** https://www.fca.org.uk/financial-lives/financial-lives-2020-survey
We can refer you to a trusted partner to discuss your health insurance needs.