The need for Protection
Your home is usually your biggest asset and it therefore makes sense to protect it.
For most of our working lives we strive to pay off our mortgages and other debts. Illness, unemployment or an untimely death in the family does happen and it can jeopardise the ability to repay these commitments and can ultimately lead to repossession of your home should you be unable to maintain your mortgage repayments.
Outlined below are the 4 main types of protection policies.
Life Assurance
The aim of this policy is to pay out a cash lump sum on death sufficient for the surviving dependents to maintain an adequate standard of living. As a minimum you should always cover your credit commitments i.e Mortgage, loans and credit cards.
Critical Illness
Again the aim of a critical illness policy is to pay out a cash lump sum. The policy will pay out on diagnosis of a serious illness such as cancer, stroke and heart attack. Most policies these days cover at least 25 illnesses. Ideally the policy should be set up to repay all credit commitments and have enough left over to help pay for any medical costs. However even a smaller more affordable amount can be of great assistance at a time of illness.
Income Protection
Should you be unable to work due to having an accident or illness this policy will pay out a monthly amount for a predefined period. Although your employer may pay your salary if you are unable to work for a short period of time many employers will not pay you if you are unable to work for more than a month. The monthly income from this policy will ensure you can meet your monthly commitments for a set period of time or until you return to work.
Redundancy Cover
Should you be made redundant this policy will pay you a monthly income for a set period of time or until you can find alternative employment. Again this monthly income will ensure you can meet your monthly commitments.
Do you already have cover in place?
It is good practice to review your policies every couple of years to ensure the premiums are still competitive and to ensure you have the right amount of cover for your current situation.
All of the protection policies named above have benefits and drawbacks. Drawbacks can include exclusions and limits to the amount of cover. We will discuss these with you before we make a recommendation.
For more information please call us on 01737 222353 or complete the online enquiry form.
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