Life Insurance - Have you Got it Covered?

It’s never been as important to ensure that enough life cover is in place.  Now more than ever the onus is on the individual or business to protect themselves.  The state will not pick up the pieces, if the worst was to happen through either death or illness.

I wanted to share with you some real life examples as to how I have helped our clients recently, and it may help you to identify scenarios which you may help yourselves, your friends or relatives too.

Life events – Birth of a Child

A couple recently were blessed with a new addition to the family.  Brad is aged 35 and Angie is aged 30.  I arranged £765,000 Level Term Assurance cover for 25 years to cover their family unit until Brad turns 60.  The premium is £14 per month for Angie and £26 per month for Brad.  Both policies come with a guarantee that premiums will never change.

Victoria wanted to put cover in place for her and her unmarried partner; they too have just had a baby girl.  Cost is an issue as they are on a tight budget.  Family Income Benefit is a policy which provides an annual income on death over a specific term.  Victoria wanted £25,000 to pay annually if either her or her partner, David died (both aged 38) for the next 21 years until Harper is old enough to fend for herself.  This means that the sum assured at outset is £525,000. The premium costs £18.82 per month, with a guarantee that premiums will never change.

Life event – Business Protection

Alan’s business has recently restructured and on investigation has insufficient life cover to protect their debts if Nick, a key employee, was to die. This would have serious consequences for the remaining partners who invested their time and experience training Nick as an apprentice since graduating from University. Business Life cover of £1.8 million over 15 years was arranged with a premium of £40 per month, with a guarantee that premiums will never change.

Life event – Change of Job

Jade, an independent woman, aged 33, recently started a new job and joined a company where there was no life insurance or sickness cover provided as part of her package of benefits.  Jade has a £140,000 mortgage in place and was concerned that in the event of an illness, she would still have the burden and responsibility of keeping up repayments.  She assumed that her bank provided life insurance and sickness cover as part of her mortgage repayments.  I asked her to check with the bank, and she discovered to her horror that the mortgage was unprotected.  Having had a history of illness in the family, Jade wanted to ensure that in the event of a critical illness (heart attack, cancer, stroke) her mortgage would be cleared.  The premium is £25 per month and the policy includes free life cover and a guarantee that premiums will never change.

Why Does this Concern me?

We independently compare the whole marketplace to ensure our clients are getting the best deal, just like shopping around for car and house insurance. We have access to the whole marketplace and are not restricted to a single, or panel, of providers.

Now more than ever, with family budgets coming under increasing pressure, it’s important for clients to check existing cover that’s in place to ensure it’s sufficient and cost effective. 

Matt Slessor

Financial Planning Consultant

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