10 October 2018

Protecting Your Lifestyle - Insurance Options

We're all aware of the role that insurance can play in protecting our "stuff" - cars, house contents, pets, and so on. But insurance also provides wider opportunities to protect our lifestyle and those we leave behind when we die.

Term Assurance is fairly straightforward - and often inexpensive. It could, for example, provide a lump sum to pay off a mortgage if you were to die. That's essential protection where a family could be left behind. It is also possible to receive the payment in instalments - perhaps to cover ongoing family expenses for a while.

Whole of Life Cover might be relevant if you want to be sure to pass on a lump sum to someone on your death. That could provide your family with the means of paying an Inheritance Tax bill, for example.

Income Protection Insurance could be valuable if you don't have a big employer to carry on paying you while you are off sick. Many small business owners would struggle to survive financially if they were off work for any length of time. Income Protection Insurance could replace a proportion of your income.

Critical Illness Cover - If you have concerns about particular illnesses then this insurance pays out on the diagnosis of a range of ailments. It is not intended to exactly match any additional costs you may incur, but provides some compensation in a difficult time.

Private Medical Insurance will help pay for private health care, enabling you to receive treatment at a more convenient time and place than the NHS might have provided. Alternatively, if you have adequate invested assets, you might choose to "self-insure" and pay for the treatment directly.

Business Owners have particular requirements. It may be about mitigating the effect of losing a key person in the business if they die, or it may be about having a lump sum available to buy the shares of one of the owners if they die. That is likely to need a shareholder agreement alongside term assurance.

Overall the most important things are to know what event you are insuring against, and what you want to happen if it does.

Blog Archive