What to do, what to do???

kessik

I have had an insurance policy on my three children for about 15 years now. It covers the child if they have to go into hospital for a period of time - it pays out a good sum per night, about £115. Initially it was £7 per month and over the years it has risen to £30 per month. It covers children to 18 years and although my eldest is now 19 the premiums didn't go down - apparently it costs as much to insure 2 children as it does three but reduces if there is only 1 child. My two boys are now 17 and nearly 16 and I'm thinking about cancelling the policy because although I can afford to pay it, the only time I tried to claim on it my claim was turned down. My youngest was in hospital for 3 nights but because it was with an illness, not as a result of an accident he wasn't covered. My dilemma is this. I am wary of cancelling the policy because I feel it's tempting fate - that as soon as I cancel some accident will befall one of the lads and I'll be furious and distraught at the the thought of paying all those years and nothing happening, then cancelling and a disaster occurring. I know I'm superstitious - what would you all do? Sit out the last two years till the youngest is 18 or cancel?

kessik

dacouch

Does it only pay out a sum of £100ish if they stay overnight in hospital due to an accident, if so it is a very very poor value policy

dunstonh

Hospital cash plans = cash cow to seller.

The banks sold a load of these years back. Complete waste of money as the cost vs claims ratio was awful.

dacouch

Dunstonh I agree, it seems to me if its just paying out an amount if they are in hospital then its a licence to print money at those levels of premiums. Even if it includes a set benefit if they say break a leg as well it still seems very expensive

dunstonh

I have tended to find over the years that the people with these plans often have insufficient life assurance, income protection and/or retirement provision.

In this case, £30pm is a lot for insurance. How does that compare to how much the OP is paying for life assurance, income protection or their pension contribution? Things that are far more likely (death before retirement is around 4 times more likely than claiming on a hospital cash plan before retirement for example).

You cannot insure yourself for everything. You have to prioritise and take the risk that you dont cover yourself enough (no-one has the budget to cover every risk). These plans tend to sound attractive in what they do but statistically they really need to be right at the end of the list of priorities to consider.