Do You Have Any Protection?

David_White

anotheruser wrote: »

Coming back to your point about mobile phone insurance David White - the liklihood of needing that particular insurance is much more greater than critical illness or something similar.

Breaking your mobile phone = Largely in your control whether this happens (i.e you could be more careful, buy a better case etc)

Being diagnosed with a Critical illness = Largely out of your control (with the exception of things like smoking of course).

Have a look at this website: http://riskreality.co.uk/intrinsic

ACG

64% chance something will happen to me before I reach 65 - I dont fancy my odds much!

daivid

David_White wrote: »

Have a look at this website: http://riskreality.co.uk/intrinsic

Their calculator is ridiculously simplified and surely they have a vested interest in scaring people.

56% risk of any of the above apparently.

ACG

kingstreet wrote: »

When the changes in SMI are made turning the benefit into a secured loan, there should be a mandatory protection rule introduced so borrowers can continue to make their payments in the event of illness or unemployment.

http://www.mortgagesolutions.co.uk/better-business/2016/04/05/68459/

Kynthia

anotheruser wrote: »

I'm not particularly arguing for either side

But I do see it as a bit expendable at the moment.

I don't have pet insurance, I'm happy to pay when it happens... if it happens.

Coming back to your point about mobile phone insurance David White - the liklihood of needing that particular insurance is much more greater than critical illness or something similar.

I guess that is what insurance is about; weighing up the chance of it happening. If my cat gets ill, so ill it's too much for me to pay, I'll accept and put them to sleep. The difference is, if I insured them now, I might be paying £12 a month, for 7/8/9 years before I need it. If I saved that money in a seperate account, I am sure it would be enough to cover what I needed.

Again, I understand this is completely different insurance, but the principle is the same.

You're missing half the calculation. Yes you factor the liklihood of it happening but you also you factor in the impact. The liklihood of breaking your phone ever is fairly high but the impact is low as tge worst that happens is it costs you a few hundred. So unless you are terribly irresponsible with your phone's most of us would spend more in Insurance over the years and can afford the replacement cost so the insurance isn't worth it. The liklihood of you being too ill to work for significantly longer than a year is low but what is the potential impact? The impact for many would be losing of tens of thousands of pounds if not more, severe financial hardship for the whole family and potentially losing your home. The fact the impact is so great is what makes it something many of us consider worth insuring for.

getmore4less

Some key things with insurance are

Understand what it is you are insuring and why.

Are you prepared to self insure.

Travel insurance is quite a good one to look at.

Consider three components of travel cover

cancellation cover.
we only take holidays we can afford to pay for so prepared to self insure that loss.

Baggage
Another we can afford to self insure, we can replace over time as we have too much stuff anyway.

Medical.
UK self insure(NHS)
EU, some free cover but not enough, so insure.
World wide and any repatriation,
up the insurance limit as these two could bankrupt people.

In practice this means health cover and repatriation covers UK anyway on a permanent rolling travel policy to avoid the issues with Annual policy renewal.

.......................................
Back to the mortgage.

what are you trying to cover

The ability to pay the mortgage.
primary causes loss of income events
So the real thing you are trying to insure is not mortgage payment but income loss which has much wider scope.

Two main options lump sum(to reduce the need for income) or replace the income
Third for the mortgage part is use the security(the lenders insurance) and sell

Death events are the easiest follow through
One person, why bother with death cover?
Two people, sell, lump sum to cover the share of the debt or full cover to leave the survivor mortgage free, will they be able to cover costs on one income or does the cover need to be more than the debt.

One/Two with dependents generally full cover is needed in case the survivor has to give up or reduce income, often extra costs involved like child care which need insuring if the dead person contributed.

AS the real event being insured is loss of income the level of cover should be reviewed beyond just the mortgage related costs.

Loss of job events(not death or illness)
Again relatively easy to understand and there are cover options, or save up enough to cover N months and be self insured.

Illness related is a lot more complicated and no amount of cover through work or self insured will help if you have to give up work to be a carer for a wife and/or child that was not insured.

Short term save enough you can self insure
Long term depends on circumstances, a single person may decide to fall back on the state other may no be happy with that provision perhaps enough cover to retain their own home( a lump sum can be better than income for this.

I suspect many don't think through what it is they are trying to cover and in some cases even with the help of advisers will have missed something or not have optimum product combinations.

lush_walrus

We don't have any but we don't really need any, our financial commitments are very low and our wages such that one of our wages, either one, going would have no affect on our quality of life. All financial commitments would be met.

However, if we still had a mortgage, one of us had an income lower than the other, or not enough saved to cover X years of financial commitment then yes I would have both of us insured.

newtosaving1

Sorry to jump in on your thread, but I have a relation question I hoped someone might be able to advise me about.

I am in the process of buying a house, first time buyer. I don't have a partner or dependants so therefore don't think I need life insurance (if something should happen, my parents would sell my house on my death).

However I am wondering how easy it is to buy critical illness on its own, unfortunately, Martin doesn't have a section just for this on his site, just life insurance!
Does anyone have this on its own? Do you mind me asking how much it costs?
Any advice would be muchly appreciated.
E x

amnblog

Yes, you can purchase critical illness insurance without life cover.

You will find however that the cost of adding the life cover so that the policy pays on death or critical illness is so minimal you may consider it. This enables you to leave your parents with a mortgage free asset in the event of your death.

David_White

A lot of CI policy's include life cover at no additional cost so make sure to quote with and without.

If there's no cost you may as well take it.... leave the money to the local cat rescue if needs be!