What life/mortgage/critical illness insurance do I need?

ElleWoods

At the moment I have none of the above and really think I should get some, especially in the current climate where there are a lot of redundancy worries etc. I have a house with a mortgage of just under 90k, plus I'm a single parent and have no savings to speak of, so if I lost my job or become too ill to work, we would be in a mess financially.

I find the whole subject very confusing so my question is, what insurance should I take out? Should I take out some form of salary replacement insurance (if there is such a thing) that would pay out if I was ill or made redundant? Or should I just take out mortgage payment protection that would kick in under the same circumstances? Or do I need more insurance than this?

Money is pretty tight as it is, so don't want to spend lots of money on insurance, but at the same time would like to take out enough to feel secure should the worst happen.

Thanks,
CC x

dunstonh

Mateus post reported.

I am a Free Whole Market Mortgage Adviser..... snip....and the advice it's free.

You are free are you?

Its one thing to break board rules but false advertising and breaching FSA rules on financial promotions are something else.

dunstonh

Yes I provide free advice as receive only commission from the lender and search the whole market

This thread isnt about mortgages though. Its about insurance. Dont try twisting your authorisation in one area to make it sound like you are free in another. That level of misrepresentation is the sort of disgraceful behaviour that gives all in our industry a bad name.

I am not breaking any FSA rules, please read the MCOBS before say something.

So posting a financial promotion giving your contact details without any compliance warnings is not a breach of FSA rules?

As MSE Martin says in other post we can post offering help to the ones asking for it.

Martin does not say that at all.

Probably you are one of those brokers who charge huge fees...

No, I am an IFA. Not a broker. Cant you tell the difference?

I see the board has removed your financial promotion so they obviously agreed with me.

For Cuba Cat - im not able to give advice or tell you what is the best for you without assessing yof you need insurance advice without paying a fee you can send me a private message. I need to assess your needs and budget as that is against FSA treating customers fairly.

Again, against board rules. Will you not learn?

ElleWoods

Please can you just stop bickering?! I'm just wanting some advice on insurance, not a 'handbags at dawn' situation.

Can anyone give me any useful advice please?

CC

dodgyeyes

I have been in a very difficult position and thankfully had insurances in place. When I had to give up my job for health reasons, I was lucky to have critical illness and an employer insurance replacement scheme.

Critical illness covered my mortgage and pays out in one lump sum - be very careful though - many illness are not covered and insurance companies will squirm to get out of paying on the policy. I battled with Norwich Union and financial ombudsman before we won our case. Critical illness in my case was just that - it should pay out if you unfortunately succumb to an illness that will stop you working in your 'current employment' on a permanent basis (sometimes you can get 'any job' cover but this is risky to take out because they will always find another job that you could do if you can't do the one you are trained for).

Income protection can be arranged by yourself or sometimes employers offer a policy. It is up to you how much you cover yourself with financially and after what amount of time you need to start claiming eg 1 month, 3 months etc. Always look at the small print and remember that you may get statutory sick pay although this does not always cover your income.

I hope my experience helps but everyone is different and other people may have other ideas. Good luck!

Mateus_2

Cuba_Cat wrote: »

Please can you just stop bickering?! I'm just wanting some advice on insurance, not a 'handbags at dawn' situation.

Can anyone give me any useful advice please?

CC

Hi Cuba Cat

You are right. I was saying that are different insurances out there, like Income Protection, MPPI, Life Insurance, Critical illness, Family income Benefit. It is very expensive to have everything, probably in your case your main priority is the income so you may decide between MPPI or Income Protection or a bit of both. My main concern will be the budget as this will determinate what you can afford. All the policies have advantages and disavantages.

Cheers
Goncalo

TEDDYRUKSPIN

Ha... funny funny.

Just go and see an financial advisor. Tell them your budget and what you want!

thejoose

I think PHI can be a great policy but you should always bear in mind that in the case of a critical illness income policies can leave you short of what you may need. Income policies are great if you are unwell for a long period but with a serious illness you may have high expenses over a short period whcih is why critical illness pays you a lump sum.

i would tend to think that you should cover the risk of serious illness first and then if you can afford it add income protection as a second priority.

dunstonh

Personally, I prioritise PHI above CI on the basis that PHI covers more illnesses and replaces your income.

However, trying to decide between PHI and CI is a bit like deciding between buildings insurance and contents insurance. You need both really as they cover different things.

thejoose

Certainly a dilemma. You have to say that the fact that you can receive benefits for conditions like stress and back pain on PHI makes it a great policy to have. I just tend to think cover the biggest risks first however as you say they are really two distinct policies tackling a different issue.

ElleWoods

Please could someone just explain what all the abbreviations mean - CI? PHI? etc.

Thanks,
CC