Life Cover & Critical Illness
Protect yourself and your assets
Life Insurance is and has always been one of the most important elements of effective financial planning, not only to protect yourself but to protect your assets. Life Insurance is and has always been one of the most important elements of effective financial planning, not only to protect yourself but to protect your assets and families in the event of death; and will only pay out on the death of the life assured. Depending on your domicile status it is also a useful tool for Inheritance purposes and the mitigation of death taxes. At Seven Insurance Brokers we complete a contingency planning exercise with you, to make sure we are covering what is important for now and the future, based on the facts and figures that you deem appropriate.
Depending on the provider that you chose there are additional policy benefits available that include Family Income, Fixed Income, Terminal Illness, Waiver of Premium, Cancer Cover Only and the ability to have decreasing term that may be suitable for cover of mortgages or borrowing.
Term Assurance will cover the life insured for a specific period of time known as the term. The premiums are worked out from start to finish and then averaged over the period of the term to give the amount payable on a monthly, quarterly or annual basis. Once you reach the end of the term the policy will cease. A Term Assurance policy does not contain any investment and has no cash-in value at any time. Term Assurance works on a pay as you go basis, meaning it will remain in place as long as you continue to pay the monthly premiums. Seen as being cost effective you can get a higher amount of cover for a lower premium.
Whole of Life
The idea of Whole of Life is to give the life assured cover for the whole of their life and a standard policy will end at age 95. The premium is worked out based on you paying in various ways that include Limited Pay Life/Vanishing premium (paying a larger amount over a shorter period of time), Indexation (where the premium and cover both increase by 5% each year) or Whole of Life (where you continue to pay until you decide to cancel or die). A whole of Life policy combines Insurance with a savings element and will use a range of funds to provide growth to the investment over the years as specified from the outset. Because the policy is unit linked the cover amounts and premiums can be altered to increase or decrease depending on the change in circumstances. With a Whole of Life policy having invested premiums there is a cash-in value available normally after a specific period giving additional options in later life.
Contingency Planning with a living benefit
Similar to Life, Critical Illness cover is an extension to contingency planning, however this provides a valuable living benefit. Critical Illness is designed to pay to you (the insured), on the diagnosis of a pre-determined list of illnesses, diseases and/or disabilities. It is used to replace any income that may be lost and give you the means to be able to get the best treatment without impacting on your personal funds and savings.
Total and Permanent Disability
Total Permanent Disability is the third most used benefit with protection policies. Although to some extent disability is covered in Critical Illness, TPD is a standalone cover amount that will pay out in addition to other benefits. TPD will pay out to the insured if they are diagnosed to be permanently and totally disabled in line with the providers description of not being able to work or perform daily activities. This could be considered more important for people that may be at higher risk of injury or disability at work or traveling to work.