New Year, new you

Many of us will have rounded off the excesses of the Christmas break with the New Year resolution to take better care of ourselves in 2019.
It is one that is well worth keeping. Most of us could enjoy some real health benefits if we shed a few pounds, took a little more exercise and watched what we ate and drank.
But what about keeping our finances healthy?

The cost of being unwell

A healthier lifestyle can improve our chances of staying well. The bad news is that despite all we can do, illness and accidents can strike anyone, including the young, healthy and physically fit. Being unable to work because of poor health means financial problems. The mortgage rent and utility bills don’t stop coming in simply because your salary does.

But there’s another problem that many families do not recognise until it is too late. Being ill means additional costs. Shopping, cooking and cleaning all become much more costly if you need to pay someone else to do them for you.

Breadwinner or house person, you need a financial plan in case of illness.

Keeping your finances fit

You may need more than one type of cover if you become ill.

Private medical insurance is designed to cover the costs of private healthcare. It helps ensure that that you receive treatment as quickly as possible.

So, while the NHS will still help in an accident or emergency, it can mean being on long waiting lists for other conditions.  Most private plans ensure prompt treatment in a well-equipped private hospital helping ensure a faster recovery.

But private medical insurance can’t replace an income or deal with the extra cost’s illness makes inevitable.

That’s where health-related financial insurance can help. There are several types.

Critical illness cover

Critical illness cover is designed to pay out a tax-free lump sum if you are diagnosed with a specified medical condition.

There may be a standard list of conditions, with some insurers including more than 60 medical problems, or you may reduce your premiums with a shorter list. It’s always important to know what is and isn’t included and reading the small print carefully is essential.

You can spend the money how you wish, perhaps to pay off debts, to adapt your home to your needs, or simply to provide for the costs of everyday living.

Income protection

An alternative to critical illness cover is income protection insurance. This can make regular payments to replace your income if you suffer health problems which will mean a temporary inability to work.

There are two main types.

The first is Permanent Health Insurance, or PHI. This is designed to allow you to protect a portion of your income, often 50% of your salary. It pays if illness or injury stops you working and can continue until your normal retirement age.

The second is Accident, Sickness and Unemployment (ASU) cover. This can protect the payments on your mortgage, other debts and provide some income in the event of illness, an accident or losing your job through redundancy. ASU is more limited in scope and will cover you for a maximum of 12 or 24 monthly payments.

What will it cost?

The cost of cover will depend on your individual circumstances, and the younger and fitter you are when you take out cover, the more affordable it will tend to be.

Getting the combination of cover you need to provide a real financial safety net requires expert, individual advice. So, if you are planning a new you for the New Year, there’s another resolution you need to make.

Call us at Continuum to discuss the health-related cover you and your family need.

The information contained in this article is based on the opinion of Continuum and does not constitute financial advice or a recommendation to suitable investment strategy, you should seek independent financial advice before embarking on any course of action.

Insurance which is based on an assessment of the health of the applicant is unlikely to cover the applicant for previous or existing medical conditions and you should refer to policy documentation and seek advice in order to understand what the policy does and does not cover before making an application.

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Book an initial consultation with one of our independent financial advisers or call us on 0345 643 0770 if you would like to discuss further.

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