Family ProtectionCaring for you and your family.
Sometimes, we’re so busy building the life we want that we forget the things that could put it all at risk. No one likes to think about getting ill and not being able to work. Even when we see other people going through difficult times, it’s still tempting to think it won’t happen to us. We can help give you the peace of mind that if things go wrong you are covered.
Coming to terms with being diagnosed with a serious illness or the loss of a loved one is never an easy thing to do and adding financial burden to the grief can make coping increasingly difficult. Receiving a lump sum of money can help to support your family. Protecting your mortgage and your family should the unforeseeable happen is something that provides unparalleled peace of mind. Would you and your family be able to cope financially if you were suddenly diagnosed with a serious illness or died? Would they be able to pay the mortgage and sustain their current lifestyle?
(Morbidity Statistics 2018 most recent statistic)
We can help provide your family financial protection when they most need it, should the worst happen to you. During the cover term, the cover will provide your family with a cash sum to meet immediate expenses or provide money for the future. Depending on the level of cover you decide upon, this money could pay off the mortgage, meaning that your dependants would not need to worry about meeting mortgage repayments at a difficult time.
We believe it makes financial sense to protect your family and we understand this protection should be tailored to your personal circumstances within a budget that is affordable. We can find the right plan which will help protect you and your family against the impact of illness, injury, disability, unemployment and death. Depending on which cover you choose you could receive a lump sum or regular income. These payments could help with bills, debts and outgoings such as medical costs or your child’s education.
Why do I need protection?
You are having a baby
The birth of a child brings with it the consideration that you will be financially responsible for that child at least until the age of eighteen if not longer should you / they consider further education. You need to make sure that you have enough cover to allow your child to maintain a standard of living you deem adequate should something happen to you and /or your partner. This might not just mean repaying debts like a mortgage so a financial burden is removed, but also thinking about replacing a lost salary or the likelihood that in the early stages of a child’s life, you may need to consider replacing childcare costs.
You are taking out a mortgage/changing the terms of my mortgage
A mortgage is likely to be the biggest financial commitment you will ever have and therefore making sure the mortgage is repaid should the unforeseen occur is vitally important. You should consider protecting your mortgage in the event of your death but also in the event of illness. If you are remortgaging or purchasing then it is very likely that you will be changing the amount you owe and the term in which you have the debt over – it is therefore a very good time to review your protection needs and top up your cover to reflect these changes.
You are getting married
If you are getting married, engaged or simply just taking out a mortgage with your partner, you need to think how your partner would cope should your income no longer be available due to death or illness. If you have a mortgage would they be able to continue to meet the payments, if you have children would they be able to work and look after the children? More than anything you should consider repaying any debts, but also replacing your partners lost income.
You are getting divorced
Divorce doesn’t mean you lose dependency on your former wife / husband. If you have children together then School & University Fees or indeed Maintenance payments may still need to be covered should the unforeseen occur. In the event of death you may prefer to have an income to cover these expenses or alternatively you may prefer to have a lump sum.
You are starting a new Job/Occupation
Starting a new job is an important time to review your Life Assurance as you may well find that the benefits you would have received in your previous employment no longer apply. It’s important to review what you will now receive in the event of death & illness and plug any gaps in cover. If you are becoming Self-Employed then you will no longer receive any benefits from an employer. It’s especially important for you to consider how you would cope if you were unable to work through accident & sickness.
How can you help to protect me?
Life Assurance is often referred to as Life Insurance or Term Assurance. There are several different types of Life Assurance – all will pay in the event of the death of the policy holder. You choose the amount of cover you want and how long you would like the policy to run for to fit in with you and your family’s needs. Term Assurance pays out a lump sum on the event of your death to your estate. This can be used to help your dependants cope with your loss and the loss of your income. Family Income Benefit is a form of Life Assurance that pays out a regular income rather than a lump sum. Having an income instead of a lump sum in the event of death takes away the worry about having to invest the lump sum. It is often used to replace a lost salary or cover set expenses such as school fees.
Mortgage Life Assurance
With most standard repayment mortgages you will not receive automatic insurance cover or payment protection. Mortgage life assurance is a guarantee that allows any outstanding mortgage payments to be paid off in full should you die before the end of the term. This means that your dependents will not have to finish the mortgage payments in the event of your deathRepayment (Capital and Interest) Mortgage: The most appropriate Life Assurance policy to protect a Repayment (Capital and Interest) Mortgage is a Decreasing Term Assurance (DTA) also known as a Mortgage Protection Assurance policy as the amount of cover falls in line with the reducing mortgage debt.
Interest Only Mortgage: The most appropriate Life Assurance policy to protect an Interest Only Mortgage is a Level Term Assurance (LTA) policy as the amount of cover remains level for the term of the policy and will therefore reflect the fixed level of mortgage debt.
Critical Illness Cover
Critical Illness Insurance (CIC) will pay the policy holder a lump sum on diagnosis of one of a large number of specified illnesses – the illnesses covered vary but generally include the major illnesses like cancer, heart attack and stroke to deafness, loss of limb or loss of sight. The Lump Sum can be used however you like but is often used to repay or reduce the burden of a large debt (like a mortgage) or even pay for household bills and cover potential medical expenses. Most Critical illness policies include benefits that are paid out if one of your children should suffer in this manner at no extra cost, without affecting your own personal benefits from the policy.
Income Protection, also referred to Income Replacement or Permanent Health Insurance (PHI), provides the policyholder with a regular monthly income (of up to 50% of your earnings) should illness or accident prevent them from working. They will continue to receive the income until they return to work or retire, helping you keep up with mortgage or any other loan repayments. Simply put, income protection offers borrowers the security of knowing that their essential repayments will be made if their life takes an unpredicted turn.Unemployment Cover
Unemployment or redundancy cover is an annually reviewable policy providing short term cover if you are unable to work due to unemployment or redundancy similar to, but not to be confused with, Income Protection as it does not pay out for as long (max 2 yrs) or pay out as much. Accident, sickness and unemployment cover, can give you the peace of mind of knowing that in the event of redundancy or illness your mortgage payments will be made and your home will be safe.
If you have a mortgage then you are required by your mortgage lender to take out buildings insurance. When it comes to choosing insurance for your home there are a number of things to consider, but the most important one has to be ensuring your family’s home and possessions are protected. Buildings insurance is designed to cover damage to the structure of your home as well as damage to permanent fixtures and fittings. Home contents insurance covers all your belongings from clothing to kitchen equipment to works of art, furniture, and electrical equipment. It also covers curtains, carpets and items in your garden. Most contents policies also cover the contents of your freezer. Accidental damage cover is also available to protect you against things like paint spillage and damage caused by pets, although this cover usually costs extra. We search through many of the UK’s top insurance companies to find you a selection of the cheapest building insurance, home insurance or home and contents insurance available. Simple Financial Solutions acts as a credit broker not a lender.
What other things should I consider?
Waiver of Premium
Waiver of Premium is an additional option that can be taken out with most forms of protection. The insurance company will pay the premiums due on a Life Assurance policy if the policyholder is unable to do so because they are unable to work due to accident or illness. The insurance company will pay the premiums for you until you are able to return to work. We can help you see if you need this cover.
Policies in Trust
A trust is an arrangement whereby people hold assets for the benefit of others. You may write your protection policy in trust for a number of reasons such as potentially avoiding inheritance tax, ensuring the policy benefits go to the right person and to minimise delays in the payment of the policy. We can help you decide if this is the right option for you and if required how to put your trust in place.
The Financial Conduct Authority do not regulate trusts.
Terminal Illness is an option included in Life Assurance polices whereby the Life Company will pay out if the policyholder is terminally ill – NOT to be confused with Critical Illness cover. We can help you decide if this is an option you need.
Renewable Premiums means that the premium is subject to review and potential increase over the term of the policy. Guaranteed Premiums mean the premiums you pay do not increase over the policy term. Generally Renewable premiums start lower than Guaranteed but are subject to potential increase. We can help you choose the right option for your circumstances
The type of plan you need, how much cover to take and for how long are all things we can help you with. By helping you with the choices available to you, we can make sure that you get the protection plan that suits you today and also changes with you as your life changes.