Insurance and Savings

Article published on 24th June 2008

If you have a specific savings account or perhaps investments in stocks and shares, it is worth considering private insurance as part of your investment plan. This doesn't just mean insurance directly connected to those savings, but insurance that relates to other aspects of your life that can impact upon the integrity of those savings and investments.

For instance, if you contract a critical illness like cancer or heart disease, or even if you are made redundant, the chances are that you would have to dip into any savings to counteract the negative effect on your family finances that these rather unpleasant circumstances can bring.

If you have one or more income protection insurance policies, as an example, should you lose your job for whatever reason, then you can still actively make money through interest on your savings or fluctuations on the stock market, without having to dip into or cash those assets. Your income protection insurance would likely cover your daily expenses, giving your savings and investments time to grow uninterrupted.

Something similar can be said for critical illness cover (which can provide money for treatments and/or cover the cost of missed work due to illness, depending on the sort of policy you choose), and indeed life insurance, which means that if you happen to die unexpectedly (Heaven forbid!) your family won't suddenly be lumbered with debts that would normally be covered by your income.

So if you protect yourself you de-facto help protect your savings and investments, allowing them to continue to grow.

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