We insure our cars not only because of the law, but because it’s easy to see the risks and the costs of not having cover. Most of us have life insurance for the same reasons – as we may have cover to help ourselves or our families in the case of accident or illness.
But even if we have cover, our needs change over the years. Cover which was generous in our carefree 20s may be less than adequate when we have a family to provide for.
We look at why it might be time to spring clean your insurance protection and how Continuum can help.
Protection for life
There are different kinds of life insurance. If you are looking at giving yours a spring clean, the first question to ask is ‘Do I have enough cover?’ followed by ‘do I have the right kind?’
The cost of living has gone up steadily. If your cover was arranged years ago to cover the mortgage, it may not be enough to replace your income now – let alone in the future.
If your mortgage is paid off, your children left home and retirement beckoning, you might be tempted to think that spring cleaning could involve throwing out your life insurance altogether. This could cut your outgoings, but life assurance can still be a big help – because it can deal with inheritance tax. If you have ‘whole of life’ cover, with no age limit, written in trust, it falls outside of your estate. This means it can be paid without a wait for probate – and pay off your inheritance tax liabilities.
Life Assurance is a versatile financial tool – but there are many different types and many providers and getting the most suitable level and type of cover is essential.
Protection for health
There are two types of medical cover to look at in your protection spring clean.
Private medical insurance is designed to cover the cost of private treatment and in many cases provide faster treatment in a private hospital.
Critical Illness cover is also concerned with medical matters but pays a tax-free lump sum if you are diagnosed with a specific listed illness.
Both types of cover will most likely exclude existing conditions, and the older you are, the more expensive they are. This means you could be priced out of cover just when you start to need it most. So, if you don’t already have it, you might want to look at medical cover now.
Protection for your income
If you are spring cleaning your protection, remember that insurance can provide an income if you become unable to provide it yourself.
If accident or illness – or in some cases redundancy – meant you could not work, income protection insurance could provide a monthly income until you were able to return to work.
Short-Term Income Protection policies, or Accident, Sickness and Unemployment cover, pay out for one or two years, and can include cover if you are made redundant. Alternatively, Long-Term Income Protection can pay a regular income until you can return to work or to your retirement age.
Do you need an insurance spring clean?
If your existing cover has been in place for five years or more, it may not have kept up with rising prices.
It is not just inflation. A new home or new members of your family may mean your needs have increased.
To be certain of the level of protection you need for your life, health and finances you need expert advice.
At Continuum, our focus is on creating a bespoke protection plan, using state of the art technology, to suit your needs and circumstances. We assess your protection requirements, discuss these with you and then arrange the suitable policy to be implemented.
To find out how we can assist you please contact us today.
The Financial Conduct Authority does not regulate taxation and trust advice.
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.