meeting with IFA - things to consider/ask him?

silverfoxuk

We have a meeting with our IFA on Thursday to discuss his recommendations regarding our protection arrangements. We have no cover in place just now, I am age 37, wife 36, one son aged 10 weeks. My income is £40k pa, hers is £15k.

His suggestions are:

1. Life Insurance with Critical Illness
Generating a lump sum to clear off debts particularly the mortgage on death or critical illness (joint life decreasing mortgage cover 22 years)
2. Family Income Benefit
Providing cash to the surviving partner to bring up financially dependent children (individual policies, benefit index linked for 25 years)
3. Income Protection
Provide replacement income if income stopped because of prolonged ill health (individual policies index linked to age 60)

The premiums for FIB and IP are fine, but the life insurance with critical illness is £60 per month, for decreasing cover of £120,000 for 22 years. I'm not sure I need the critical illness element here, especially if I have Income Protection (PHI) cover. I can't think of many instances where I would have a critical illness (CI payout) and still be working (no PHI payout) but I suppose they do happen.

Any comments on the above approach? Any suggestions for things I should consider or check/discuss with our IFA before we make a decision?

dunstonh

Remember that the intial recommendation has to be there to cover the full shortfall. In reality most people do not cover the full shortfall due to affordability. If you covered everything you needed, you wouldnt have enough left to live on. So you need to prioritise and set your budget and discuss what you feel it best. Income protection should come ahead of CI in the pecking order.