There are numerous different types of life insurance which provide valuable protection and can be set-up at relatively low cost. Insurance covering just your mortgage will not replace your income in the event of death and you should consider the benefit of additional cover to provide capital to your family.
The whole of Life Insurance policies can be used as effective Inheritance Tax and Estate Planning.
Critical Illness Insurance
If you were to contract a Critical Illness this can be financially draining on your ability to work and finances. Critical Illness Insurance is an effective way of protecting against your capital being diminished for treatment or replacement income. The chances of contracting an illness are much more likely than dying prematurely, leading to higher premiums for critical illness policies than life insurance, however setting up even a small level of cover will help give you and your family peace of mind.
If you were to become sick or injured and not able to work would you have sufficient cover in place? Some employees will have an element of protection against this, but a lot of people would see their finances suffer heavily if they were to miss any period of work. Income Protection Insurance will cover you if you are off work through illness or injury and will pay a regular income to replace part of your usual earnings. These policies are particularly popular with business owners and self-employed individuals as they would potentially see their income disappear through a work absence. Income Protection Insurance provides reassurance that even a minor health incident will not affect your family’s well-being.
Private Medical Insurance
It is fair to say that everybody would like the best treatment if they were to contract a serious illness or require a major operation. Private Medical insurance covers you for a range of illnesses and injuries and will ensure you have the best care available and the shortest wait for treatment.
Should you put your Life Insurance in Trust?
When you place an insurance policy in trust it means you are effectively surrendering the benefit of the cover entirely to another person, usually your children and/or spouse. The benefit of this is that the benefit does not belong to you and therefore is not in your estate, which can make the benefit much more tax-efficient.
If your Life Insurance policy is not in trust then the benefit will be payable as part of your estate and would be subject to inheritance tax, which could lead to the entire amount being taxed at 40%. Proper trust planning should be conducted to ensure that your beneficiaries receive the maximum amount of capital in the event of a policy holder’s death.
Are you paying too much for your Insurance?
If you have existing insurances in place and haven’t had them recently reviewed, then you may be paying too much for your protection. Insurance rates change on a regular basis and you should ensure a full insurance review is conducted every few years to assess your policies and keep your costs to a minimum.
With so many different polices and providers on the insurance market you really want to ensure that you are obtaining the right cover at the lowest cost possible. FTA Financial & Wealth Management has extensive experience in personal and business insurance and will review your situation before conducting extensive whole of market research, finding the lowest cost cover to match your requirements.
Contact us today for your free, no obligation Protection review. We do not charge a fee for providing quotations and will make a recommendation to you with no commitment required.