Protecting You, Your Family & Your Mortgage

Life Insurance
It is inevitable we all die. However, we want to make sure that if it does happen and you have a mortgage or “dependents” (husband, wife, children etc.) that you have peace of mind your loved ones would be provided for and any mortgage would be paid off.
If you die within the term of the policy, Life insurance will pay out either a lump sum cash amount or a fixed regular income. Cover is usually on a level or decreasing basis.

We also have access to specialist ‘Guaranteed Over 50’s Life Insurance’. As long as you are aged between 50 and 80 and you are a UK resident, you will have guaranteed acceptance without the need of a medical, starting from just £5.00 per month.**** This product is typically used to fund the cost of a funeral or leaving a small legacy for family members.

Level Term Assurance
This will give you a fixed amount of cover throughout the life of the policy and will pay that amount if you make a successful claim. It is used primarily to provide additional financial protection for dependents after the death of the policyholder(s). For example, if the main income earner was to die, would those financially dependent on them be able to pay for the mortgage, afford to raise the children, pay the bills and keep the same standard of living. If no life cover is in place, doing this on state benefits is highly unlikely.

Decreasing Term Assurance
This is sometimes known as Mortgage Term Assurance or Mortgage Protection Insurance. The amount of cover will typically reduce each year as the amount you owe on a repayment mortgage also reduces. It will therefore pay out the current amount when a successful claim is made to be used to pay off any outstanding mortgage debt.

Family Income Benefit
This is a Life Assurance plan that under current legislation (tax year 2017/18) pays a tax-free monthly income rather than a lump sum on death. This makes it easier to pay for the monthly costs of the mortgage, running your household, child-care and keeping the same lifestyle.

Critical Illness Insurance
You can add Critical Illness cover to the above policy types, you may also purchase it as a stand-alone policy.  If the worst happens and you’re diagnosed with a critical illness as specified in the policy, it’s important to make sure you’re covered against the financial impact it could have on you and/or your family.

In the event of your diagnosis, money paid out from a Critical Illness policy could be used to help maintain your standard of living, pay off your mortgage and, if needed, pay for private healthcare.  This payment can relieve a lot of stress at a time when you really need help.

Critical Illness insurance policies pay out a cash lump sum when you are diagnosed with a particular illness or suffer injury from a serious accident.

Policies vary depending on the provider, so it’s important to understand the differences. For example, the number of illnesses covered & definitions. This is why Prudens Financial Protection want to help. Contact us now to discuss this further.

Here are some facts from AVIVA and AIG regarding their Critical Illness Claims: *

 In 2016 AVIVA paid a total of £311,014,411 in Critical Illness claims (and an additional £3,256,832 in child critical illness claims)***
The average age of an AIG claimant was 45 years old (Largest claim paid was £720,000)*
AIG confirmed Cancer made up the biggest percentage of claims paid at 53% although Child Claims made up 14% of all claims*
Top three medical conditions suffered by AIG Life policyholders continue to be cancer, heart attack & stroke. These amount to 78% of critical illness claims paid*

Child Critical Illness Insurance
Many insurers also provide Children’s Critical Illness cover at no extra cost. Children are covered (and benefits paid) on diagnosis of a critical illness condition covered under the policyholders plan.

Insurance companies tend to have slightly different cover.  Some have various cover levels and some will cover from the day of birth all the way through to age 22.  It is usual of the insurance company to provide a proportionate percentage (of the total adult benefit amount). We can explain this when providing our advice and illustrations.

How many times do we sadly hear about people having “Go Fund Me” donation websites set up to help raise money to obtain quality medical care for a critically ill son or daughter?

Children’s Critical Illness cover could:

✔  Enable you or your partner to take some unpaid leave to be with your child
✔  Pay for the private medical care and specialist equipment as required
✔  Help to fund a special family holiday

Here are some facts from Legal & General from their 2016 Children’s Critical Illness claims: **
£1,800,000 total paid to parents (policyholders) in Child Critical Illness claims

Top 5 causes of Children’s Critical Illness paid claims:

1) Cancer (72.2%)
2) Child Funeral Benefit (7.2%)
3) Benign Brain Tumour (4.1%)
4) Bacterial Meningitis (3.1%)
5) Major Organ Transplant (2.1%)

Child’s age at claim (2016)

• Age 0 to 5 Years – 37.1%
• Age 5 to 10 Years – 24.7%
• Age 10 to 14 Years – 22.7%
• Age 15 and over – 15.5%

Income Protection Insurance
We all insure our cars and homes. You might insure your pets, phones and even your white goods, but we don’t always look after what pays for it all: our earnings.
If tomorrow you were taken sick or had an accident and couldn’t work, how would you pay all the bills, the mortgage, the general expenditure for child-care, food, clothes, lifestyle, petrol, etc.?

Income Protection will provide:

✔  A monthly income to help replace any loss of earnings due to ill health or accidental injury
✔  An insurance policy that’s affordable and easy to arrange; helping to give peace of mind to you and your family
✔  Continued benefits if you go back to work in a reduced capacity, with a reduced salary
✔  Tax-free payments under current legislation (tax year 2017/18) although this might change in the future

If you are employed, you will gain some statutory sick pay but will this support your current lifestyle?  If you are self-employed and cannot work due to accident or sickness, you won’t receive this and instead you may only receive some basic state benefits, which again probably won’t be enough to support your current lifestyle.  Income Protection Insurance is designed to typically protect anything from 50% to 65% of your gross salary if you are unable to work due to accident or sickness and, in some cases, unemployment.

Income Protection Insurance can cover a wide range of situations and has the potential to pay out for many years e.g. until you return to work, you retire, the policy term ends or your death, whichever occurs first.

At Prudens Financial Protection Ltd we understand the different types of cover available, providing quality, confidential and friendly advice that you need to help decide what is right for you, and at a price you can afford.

Please call us today on 01695 577 802 to arrange a meeting.  We can discuss your family insurance needs and mortgage protection needs to make sure you are all financially secure, whatever may happen in the future.  We do not charge a fee for our protection advice.

Source:
* AIG https://www.aiglife.co.uk/intermediaries/news/aig-life-reveals-2015-critical-illness-statistics / ** Legal & General Children’s Critical Illness Claims Paid 2016 statistics (click here to download the PDF) / *** AVIVA 2016 Claims Stats PT15767 05/2017  / **** AIG Over 50’s Life Plan