Life insurance
Discussion
I'm just about to exchange on a property and so need to get life insurance sorted. This is my first property, and I will be living alone. I'm trying to decide on what exactly I should be going for. The main question is whether to get critical injury cover (this ups the cost by 4x). Can anyone advise on this, and also which companies are preferable to go with?
Thanks
Thanks
As a single bloke living on your own, do you really need life cover?
I prefer to advise clients to take out permanent health insurance rather than critical illness, if at all possible. CI covers for a list of illnesses, get one and mortgage is paid off, but get something not on the list and you get nothing even if you are work for months/years.
Permanent health insurance (or Income protection insurance), kicks in after set deferment period, usually dependent on your sick pay, pays out monthly, tax free while you are off ill, until you go back to work or retire! Take it based on own occupation, index link it to RPI, use a company that only index links the premium,( not RPI + whatever.)
So no big lump sum to pay your mortgage off, but you know you will replace a large part of your income if you are off ill for whatever reason.
I prefer to advise clients to take out permanent health insurance rather than critical illness, if at all possible. CI covers for a list of illnesses, get one and mortgage is paid off, but get something not on the list and you get nothing even if you are work for months/years.
Permanent health insurance (or Income protection insurance), kicks in after set deferment period, usually dependent on your sick pay, pays out monthly, tax free while you are off ill, until you go back to work or retire! Take it based on own occupation, index link it to RPI, use a company that only index links the premium,( not RPI + whatever.)
So no big lump sum to pay your mortgage off, but you know you will replace a large part of your income if you are off ill for whatever reason.
Matt,
I used Dale for me and my wife getting life insurance when we found out we were expecting our first child. I probably spent 3 months working out what on earth I needed, with Dale endlessly answering questions and queries - my wife has a complicated medical situation - and everything was painless.
Drop him a line.
I used Dale for me and my wife getting life insurance when we found out we were expecting our first child. I probably spent 3 months working out what on earth I needed, with Dale endlessly answering questions and queries - my wife has a complicated medical situation - and everything was painless.
Drop him a line.
Matt,
On the surface of it, no - you don't *need* life insurance. In the interests of completeness though, and if your circumstances may apply, bear in mind that you might need it very badly in the future but at that point, you might be uninsurable or cover might be prohibitively expensive. I have a client who has just started a hazardous pastime and now that he needs the life cover, the rating on the premium is horrendous.
Somehow, when there are nappies to buy in the future, money is always tight and you never have the time to focus on getting it. If life cover is cheap now, if you have disposable income to justify and allow it, might it be worth taking it on and sucking up the few extra quid cost until you get used to it? Later is when you'll be needing it most.
If you do think you'd like to anticipate (everyone is different, there's no space for dogma), consider something like Family Income Benefit - which is cheaper than conventional (lump sum) life cover and it may also be applied to CIC/SIC. Having the certainty of a regular income might be far easier for a grieving partner instead of having to contend with and worry over a lump sum to invest and drawdown from. Consider PHI as well, is that more appropriate?
There are some CIC/SIC companies who I wouldn't touch with a bargepole - bear in mind that life cover can be selected on price, but scrutinise the terms of your CIC plan carefully, what may cost a few shekels more at outset could end up being priceless when you need it most because of the tiny variances in clauses. You have loads of IFAs and brokers here to help you and I'm sure you'll be well served.
On the surface of it, no - you don't *need* life insurance. In the interests of completeness though, and if your circumstances may apply, bear in mind that you might need it very badly in the future but at that point, you might be uninsurable or cover might be prohibitively expensive. I have a client who has just started a hazardous pastime and now that he needs the life cover, the rating on the premium is horrendous.
Somehow, when there are nappies to buy in the future, money is always tight and you never have the time to focus on getting it. If life cover is cheap now, if you have disposable income to justify and allow it, might it be worth taking it on and sucking up the few extra quid cost until you get used to it? Later is when you'll be needing it most.
If you do think you'd like to anticipate (everyone is different, there's no space for dogma), consider something like Family Income Benefit - which is cheaper than conventional (lump sum) life cover and it may also be applied to CIC/SIC. Having the certainty of a regular income might be far easier for a grieving partner instead of having to contend with and worry over a lump sum to invest and drawdown from. Consider PHI as well, is that more appropriate?
There are some CIC/SIC companies who I wouldn't touch with a bargepole - bear in mind that life cover can be selected on price, but scrutinise the terms of your CIC plan carefully, what may cost a few shekels more at outset could end up being priceless when you need it most because of the tiny variances in clauses. You have loads of IFAs and brokers here to help you and I'm sure you'll be well served.
Gassing Station | Finance | Top of Page | What's New | My Stuff