How many different links of insurance?

nementai

I wonder if someone can help me make sense of which life/mortgage insurances I'll be best off getting.
My OH and I (getting married in August, if that makes any difference?) are nearing completion on our first house, bought with a mortage.
The bank has been pestering us about insurance, and has brought up kinds I'd never heard of.
Obviously, I'll only go with them if they can beat the other quotes, but I'm not really sure what we want.
We're both in our 20s, don't smoke and have no illnesses or family history of illness.
We earn around £48k a year between us and I'm in the public sector, so as secure as jobs are likely to get for the moment! :rolleyes:
I'm pretty sure we want cover for our mortgage incase something happened to one of us, but I'm not sure if mortgage, life, income or critical illness are what we're after.
Illness seems silly to us, as we're both young and fit, but I'm not sure if we're being blind to the worst case scenario.
I also get a pension and salary payment through work if I die, but I'm not sure how much that would help with the mortgage, especially since I've not been here very long.
Can anyone offer advice about which kinds of insurance are a really good idea and which aren't worth it?
We don't have a lot of spare cash at the moment and what with home, car and pet insurance we can't pay out more than we really need to!

stephenni1971

To give you a breakdown into the possible types of insurance that would be relevant - and a summary of their cover...

Life Insurance

Pays out on death only.

Critical Illness Cover

Usually pays out a lump sum on diagnosis of one of the illnesses covered in the policy, although 75%+ claims are heart attack, cancer, stroke can provide cover for a wide range of other conditions.

ASU ( Mortgage Payment Protection )

A limited policy designed to pay out a monthly income for a fixed period of up to two years if you are unable to work through accident, illness or unemployment.

Income Protection Insurance

A policy design to replace a percentage of your income if you are no longer able to work through illness. Unlike ASU above, if you take a policy at 30, and had an accident leaving you unable to work, the policy would continue to pay out monthly until a pre arranged end date ( usually retirement at 60 or 65 ).


In an ideal world, you would have all of the above if needed to protect your family and yourself should anything unfortunate happen, however most people have a budget and taking all is not viable - therefore is comes down to assessing your needs and individual circumstances.

Thats where an Independent Financial Adviser comes in - your bank will more than likely only be able to offer a limited range of products from its own associated companies - an IFA should be able to access the whole of market to find the best price AND most suitable cover.

Get an IFA...

dunstonh

The bank has been pestering us about insurance, and has brought up kinds I'd never heard of.
Obviously, I'll only go with them if they can beat the other quotes

Which they wont. Banks are the most expensive distribution channels now and virtually all them are single tied and handful multi-tied. All of them operate on a salesforce model (targets, incentives and loss of job if dont perform). Not how you should be seeking advice.

If the adviser cannot explain the options then you shouldnt buy from them. A bank wont actually have most of the options available. They only have to present the best in their product range (which is often a choice of 1 product in each area).

dogbot

We are going though the same decisions at the moment in a similar position. (Though arn't married nor likely to be for some time given the cost of buying a place!)

We have a great IFA, despite the fact we both work in Financial Services, who has provided brilliant advice and service thus far.

Just to say though, don't forget your buildings and contents insurance!

edit: Ah, I see you already haven't!