What insurance cover is best for you?
Article published on 15th May 2008
Different sorts of insurance policies are designed to mitigate against different problems, so it is important that we know something about the sorts of policies on offer and what they can do for us before we decide on what to go for.
Critical Illness Cover
Critical illness cover will provide a lump sum to you upon diagnosis of one (or more) of a range of illnesses listed in your policy as being ‘critical’ - so cancer instead of gum disease. Be aware that if you already have developed a critical illness as defined in a policy that you want to buy, it is possible that you will be refused.
Life insurance is probably best suited to those who are the primary earners in families with dependents. If the primary earner then dies through some unforeseen circumstance the next of kind stipulated within the policy document will either receive a lump sum of money or perhaps a smaller sum but regularly and over a pre-arranged period of time.
Income Protection Insurance
Income protection insurance will provide for the policy holder a replacement income while he or she is unable to work. This can last until you return to work or until your pensioned retirement, all depending on the policy. A fully comprehensive policy would offer to cover your whole income in case of injury, sickness or unemployment, although policies intended for just unemployment cover are common. Even the self-employed and freelancers contracted on a work-for-hire basis are also eligible for these sorts of insurance policy.
Payment Protection Insurance
Payment protection insurance is more often than not linked to specific debts like mortgage or card repayments. Should you find yourself unable to do your job due to sickness (or whatever) your insurance plan would continue to pay off the debts you have specified in your policy agreement, usually for up to a year.
Be aware that payment protection insurance will not pay for the entirety of the debt that it is supposed to cover. In addition, payments will rarely begin before you have been off work for three months.
Whatever you think might be best for you, be sure to seek independent advice before purchase and always, always read the fine print!
Please feel free to contact one of our friendly advisor's for friendly free financial advice on 0808 1782 777.
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