Insurance
Why do I need insurance?
Protection insurance policies provide both peace of mind and a financial safety net in the event of illness, injury or death. Regardless of whether you’re single or in a relationship, have dependent children or don’t have children, chances are you will benefit from some form of protection insurance.
You might already have some cover in place. That’s great, but does it still meet your needs? It’s helpful to make sure you review your cover every few years or whenever you have a change in circumstances such as marriage, civil partnership, having children, moving home, a relationship breakdown, a new job… all these events could have an impact on what cover you should have in place.
What is life insurance?
The most well-known type of insurance. This will pay out either a lump sum or a regular income should you pass away, to provide financial support to your dependants.
The cheapest form of cover is known as a ‘term assurance’ policy. You choose how long you want cover to last for, which could be until your children are no longer financially dependent on you, or you could align it with your mortgage term to ensure your mortgage is paid off.
The other main type is known as ‘whole of life’. This policy has no specified end date – it simply provides cover until you pass away so is useful to cover funeral costs for example.
What is critical illness cover?
Critical illness cover will pay out if you are diagnosed with a specified serious illness. Some forms of cancer, heart attack and stroke are the three main conditions, though there can be many more. With some policies there are over 50 named conditions. Each condition will have a specific explanation as to what will result in a paid claim, for example some less advanced cancers might not be covered as they aren’t deemed ‘critical’.
Critical illness cover is designed to provide financial support and remove money worries at a time when the focus needs to be on your health. The money can cover everyday expenses but could also be used for private treatment, adapting the home to meet medical needs and/or enabling loved ones to take time out of work to care for you.
Do be aware that not every illness is covered by critical illness insurance, nor does it have any relation on whether you are able to work or not – for that type of cover, please see income protection.
What is buildings and contents insurance?
If you own your home, you’ll probably want to insure it, in fact, if you have a mortgage, buildings insurance will be a condition of the mortgage.
It covers the cost of rebuilding your home or repairing structural damage, as well as theft or damage to your belongings in your home. The extent of cover varies between providers. Your home’s permanent fixtures, such as kitchen cupboards, cooker, bathroom suite and wall tiles are all covered, as are your prized possessions, such as jewellery, watches and gadgets.
What is income protection?
How would you pay the bills if your income stopped because of illness or injury?
Income protection insurance can help. It is effectively your own personal sick pay insurance. It pays you a regular weekly or monthly benefit if you become too ill to work due to illness or injury, so you can continue to meet financial commitments and living expenses.
This type of insurance covers both physical and mental illnesses, and injuries that prevent you from working and earning. You choose how soon after being unable to work you want the benefit to start paying, and this benefit will be paid until you can return to work, or until the end of your chosen claim period. It can provide cover for the employed, self employed, contract workers, freelancers and business owners. There are lots of options to help tailor cover to you.
