Exciting times lie ahead, purchasing a home, but when you take out a mortgage you are taking on what is probably your biggest financial commitment. This can be quite daunting and the thought of sorting out anything else can be at the bottom of your priority list.

But you really do want to get some insurance in place. Your mortgage adviser will already be addressing your buildings & contents cover to ensure it's acceptable to the lender and covers your circumstances suitably.

We appreciate the thought of paying out more when you have taken on this mortgage won’t sound great, but there’s a very good reason too. The insurance we speak of will help stop a big financial loss in the future if the circumstances arise.

Intrigued? – To find out more please read on a little further

Life Insurance

This is the most common protection insurance to get and very responsible to have. Life insurance can be set up so that it pays off your mortgage if you die. It’s one of the most straightforward insurances you can take out.

The ‘not nice’ part of insurance, is thinking about what would happen to your loved ones, if you don’t have it and you pass away.

For many people, the family will struggle to continue to make the mortgage repayments, especially if it’s the main earner who passes. It’s possible that the family will need to sell the home, when their world is turned upside down.

After you have died, the last thing that you want is for your family to have to leave their home. Possibly relocating, moving schools, friends and support networks. You should have life insurance when you have a mortgage if you are married or have children. This is because your partner or children will inherit this debt from you when you die.

If you are single and don’t have any children, life insurance might not be the top priority for you. However the earlier it is secured the more cost effective it can be.

Income Protection (Sick Pay)

We believe this is the most crucial insurance to have for anyone earning an income. Many people aren’t completely aware of what Income Protection can do for them. Income protection replaces part of your monthly income if you are ill and cannot work. This can be for any reason that you are ill where your GP says that you need time off.

Put simply, an Income Protection Plan can pick up when your work Sick Pay ceases with your employer, or if you are self-employed at a time that fits your financial needs.

The beauty of this policy is that it could pay out for a couple of months, couple of years, or potentially pay out for 40 years. It covers you for both things that can take you out of work for a while e.g. broken arm, pneumonia, bad back, breast cancer, right through to conditions that can potentially stop you from being able to work long term e.g. Parkinsons, Stroke etc.

Life insurance as we talked of above, is something that helps your loved ones. Income protection is protecting them and you.

So, you’ve gone through all the bother of getting a mortgage so that you have your own home. By protecting your income, you can then have the peace of mind that if you are unable to work due to ill health, your home is safe as you can continue to meet the repayments and pay bills.

Remember as well, that income protection pays out when you are not well. If you are making a claim on income protection, you really aren’t well. The payout from an Income Protection policy gives you the chance to focus on your health, rather than worrying about money. Reducing stress and making recovery easier.

Critical Illness Cover

Critical illness cover is a policy that pays out a lump sum of money if you are diagnosed with a critical illness, at a severity that is determined by the insurer.

The reason that this is a popular insurance is because it pays out claims for illnesses like cancer, heart attacks and strokes. The conditions that most people are worried about.

With critical illness cover you can receive a payout that wipes off your mortgage all in one go. Or you might decide to pay for some adaptations to your home, a new car, move home completely or put some money into savings.

The choice is completely yours.

Summary

While people are aware of life cover and accepting of its need, a lot of people see Income Protection and Critical Illness cover as either or. They all have their place, and we can create a package that meets a clients needs / personal circumstances.

Example

- Life & Critical illness cover as a lump sum payment that can provide you significant financial support in the short-term.

- Income protection that pays a monthly sum giving financial security up to your retirement with the right plan in place.

We can advise you on how each of these insurances can work for you and your personal situation, and work with you to implement an affordable plan.