Help me get organised - What insurance do I need?

petite_anglaise_2

I've tried looknig through the insurance threads but am getting a little confused and would welcome some straightforward advice from you guys who know way more than me about insurance.

Here's the gist:

I've got the contents / buildings / car / travel insurance all sorted and regularly check got best deals, use quidco etc. but.....

Am beginning to panic that don't have any life/ employment-serious illness cover and am wondering what if anything I should have....

I'm 28, female, no children, am single at the mo (and given my luck in love maybe forever!!) and own my own house. Bought it a year ago and did it up (fixed rate mortgage £72K).
I'm a secondary school teacher, been teaching for 4 years, no plans to leave that sector, employed on full time permanent contract. No health problems thus far.

Have always thought that as I don't have any dependents (except the cat!) I don't need life insurance. Presumed that if I do die, my parents will sell my house or pay the mortgage etc. and will get to keep any money in my bank account etc. I don't have any debts (except student loan of £500 and obviously mortgage - £72k). Have savings of few hundred pounds, car etc. and always presumed they would just get all of this. No one else likely to come along and want my money, so do I need a will?

My job is stable and being in education sector never thought about what happens if I get seriously ill/car crash etc. But now I'm worrying that I really should have some sort of medical cover???? Think I continue to get paid for a while if I'm off sick, as a teacher, but not sure??

My parents are financially stable and I know they could easily help if I ever had a problem for some reason paying the mortgage, ie lost my job, but would obviously need to start paying again asap. Plus they would pay for my funeral etc. if god forbid anything happened to me! (Tried talking to my mum about this and just made her cry, but don't need to put money aside for my funeral!)

So, after that rather long ramble, hope I've given you all the info you need - Do I need - life insurance / - critical illness insurance / -a will / - something else I haven't even thought of?

petite_anglaise_2

...anyone?...

Seaxwyn

HI there

I don't know anything about this but wanted to bump your thread as surely there are plenty of experts out there.

My own uninformed view is no, you don't need life insurance. As you say, should the worst happen your parents (or whoever if you made a will) would get your house and other assets which would presumably more than cover your debts and the cost of your funeral.

My brother is a teacher and recently had a term and a half off with a bad back, all on full pay. He had only worked at that school a year.

I'm quite sceptical of medical insurance as the only two people I know who would seem to have a genuine case to get it both turned out to be ineligible due to very minor technical points in the small print.

So if I were you, I'd stop worrying about life/sickness insurance until such time as you may have dependents.

But as I said, I know nothing! I hope you get more helpful advice soon.

jasonking

It sounds like you dont need life insurance as you have no dependants. A Will would be a good idea as if the worst were to happen it will make sorting out your estate easier for your next of kin (parents?).

You should consider your ill health provision. Find out if you were off sick how long your employer would pay you for and then put in place Income Protection (PHI not ASU/MPPI) to start paying you an income once your sick pay has finished.

You could also look at Critical illness (pays a lump sum on diagnosis of a critical ilness such as cancer etc) and Private Medical insurance if you dont like the thought of relying on the NHS, waiting lists etc for treatment.

That should be enough unti such time as your personal situation changes.

Good luck!

magyar

jasonking wrote:

It sounds like you dont need life insurance as you have no dependants. A Will would be a good idea as if the worst were to happen it will make sorting out your estate easier for your next of kin (parents?).

You should consider your ill health provision. Find out if you were off sick how long your employer would pay you for and then put in place Income Protection (PHI not ASU/MPPI) to start paying you an income once your sick pay has finished.

You could also look at Critical illness (pays a lump sum on diagnosis of a critical ilness such as cancer etc) and Private Medical insurance if you dont like the thought of relying on the NHS, waiting lists etc for treatment.

That should be enough unti such time as your personal situation changes.

Good luck!

I would personally not advise you to get either income protection nor critical illness cover, especially as you work as a teacher. Again, you have no dependents who are reliant on your income.

At your age, and in a stable job in education your primary concerns should be to have stable finances, good savings in the best place and not to build up debt.

jasonking

magyar wrote:

I would personally not advise you to get either income protection nor critical illness cover, especially as you work as a teacher. Again, you have no dependents who are reliant on your income.

Can you explain why? What will happen if Petite Anglaise is off sick for 12 months, her income may dry up (depends on her employment contract and they vary which is why I suggested she check this out) and how will she afford to live? Whilst she has no dependants who rely on her income we have to assume that she relies on it!

magyar wrote:

At your age, and in a stable job in education your primary concerns should be to have stable finances, good savings in the best place and not to build up debt.

I totally agree. Petite Anglaise already has the debt (mtge) which needs protecting...how can anyone have stable finances if they are off sick and the mortgage is in arrears? the foundations of stable finances are quality insurances to protect against financial disasters. Insurance isnt debt!

magyar

jasonking wrote:

Can you explain why? What will happen if Petite Anglaise is off sick for 12 months, her income may dry up (depends on her employment contract and they vary which is why I suggested she check this out) and how will she afford to live? Whilst she has no dependants who rely on her income we have to assume that she relies on it!

Because, statistically, she's extremely unlikely to BE sick for several months. Most people aren't. Yes, of course you're absolutely right and I'm not questioning your position in being able to advise the right sort of insurance to get, merely that in my opinion I don't think she needs it.

jasonking wrote:

I totally agree. Petite Anglaise already has the debt (mtge) which needs protecting...how can anyone have stable finances if they are off sick and the mortgage is in arrears? the foundations of stable finances are quality insurances to protect against financial disasters. Insurance isnt debt!

Can I suggest that "you would say that, wouldn't you". Of course insurance isn't debt, but as a teacher, she's unlikely to have much spare income, and I would suggest sensible savings (ISA etc) rather than insurance that, statistically, you don't need.

jasonking

magyar wrote:

Because, statistically, she's extremely unlikely to BE sick for several months.

...but she could be and we all know people that have been. Thats why IP should only cost her around £20pm for £1,000pm of tax free benefit...it could happen, it could be financially devastating if it does yet it can be relatively cheap to protect against.

It all depends on how you look at the statistics and where your personal priorities lie.

magyar

jasonking wrote:

...but she could be and we all know people that have been. Thats why IP should only cost her around £20pm for £1,000pm of tax free benefit...it could happen, it could be financially devastating if it does yet it can be relatively cheap to protect against.

It all depends on how you look at the statistics and where your personal priorities lie.

Well, I don't know anyone, touch wood.

I think we need to agree to disagree. Statistically, I'm right (I have to be, else insurers would be out of business!), but equally you're right in that it could happen.

If he OP wants to pay £20 a month for peace of mind, then fine. Personally though I disagree.

petite_anglaise_2

Ooh, I've created a bit of a debate...! Thank you very much for your advice everyone who's joined in. given me a lot to think about. Glad I was right about the life insurance, won't bother with that one. Stil unsure about the income Protection/Critical Illness thing - I get the point that both posters are making.. hmm, anyone anything else to add on the subject?

thank you!

PIppa

Hi

I wouldn't take out life insurance as you don't need it.

You should definitely do a will. It can make things a little more complicated if you die without one (that sounds so awful especially as you're only 28).

In respect of income protection and critical illness cover, may I suggest that you check how long you will be paid for should you become ill. Also it may be worth talking with your parents and explaining that you are wondering whether you should take out cover as a precaution. Perhaps you could ask if they would be able to help you out should the need arise as you don't want to spend unnecessarily but don't wish to take advantage either. If you do it an upbeat and practical way I hope it doesn't upset your mum.

Personally I am a little sceptical about these policies so should you take out cover please ensure you read the small print to ensure it is suitable.

I hope that helps.