Mortgage-income protection and life insurance

jonnym8083

Hello all,

After some advice please.
With my mortgage the broker has advised life insurance and income protection.

However with the company I work for I get 12 months full pay for sickness. I also have income protection included as a benefit which starts at 12 months and pays 67% of basic salary which is enough for me.

In addition I get life assurance as a benefit which pays 4x my salary in case of my death in service and my spouse receiving an additional 4x salary.

I’m happy with all of that cover and amounts it would provide however if I didn’t work for the company these benefits would cease.
I am not looking to leave the company but should I be made redundant I would lose these benefits.
Would you advise to take out any cover at present or would you advise for me to take these insurances out should I no longer work for the business and lose the benefits?

Any advice or guidance would be great thanks

csgohan4

personally I would get cover that is not dependent on my employer being in business.






The later you buy the cover, the more expensive it is

SonOf

In addition I get life assurance as a benefit which pays 4x my salary in case of my death in service and my spouse receiving an additional 4x salary.

The main objective of that is to cover short term income loss and reduced pension benefits. It is not typically suitable for covering a mortgage where there are financial dependents.

Would you advise to take out any cover at present or would you advise for me to take these insurances out should I no longer work for the business and lose the benefits?

Depends on your overall financial position. For example, you havent mentioned if its just you or have you a partner/spouse and/or children.

[Deleted User]

I don't think you should have had income protection recommended. It wouldn't pay out as you have income protection already.

Your death in service is good, most people usually use that to leave a nest egg for the remaining family to pay the rest of the bills after the mortgage is repaid through normal life insurance.

You sound well covered through work, what about your wife? Do you have kids?

Would you be able to work if your wife died? Are there other people she looks after that you wouod have to stop work for or pay for other form of care?

How about if she got seriously ill with cancer? Would you be able to work full time and care for her? Drive her to hospital?

Death is black and white, a lot of people insure against it.
Critical illness is a massive grey area so people struggle to relate to it directly. The financial impact of someone being sick but not dying is worse than them dying a lot of the time.
how long does an illness last? What level of care does the person need? Do both incomes stop if 1 person gets sick? Etc etc etc

If you had to stop work cause your wife was sick, your current insurance wouldn't pay out. So you have gaps in your protection needs by the sounds of it


Honestly, good protection advice is very difficult but it sounds like what you've had so far isn't very good or personalised. Purely as they are recommending income protection that wouldn't pay out.

jonnym8083

Thanks for the info... my wife also have death in service benefit but no income protection.

If my wife fell ill and I had to care for her and stop working are there Insurance’s to cover things like that?

[Deleted User]

Well kind of. Its impossible to cover all possibilities but you can have a critical illness policy on her that would pay out a lump sum if she was diagnosed with a defined illness.

So you get to have an amount that you feel would give you a safety net (£20k, £50k, £200k, there is no right or wrong answer) and you get to access it if she gets sick. You can use it for any purpose but I know a lot of people use it to cover their salary if they need to cut a day or take h paid leave for a time.

Included within a lot of income protection polices is Carer Cover as well which will pay your income if you have to stop work to care for an immediate relative. Maybe the one through work does this as well??

Have a good look through what you are and aren't covered for with existing policies before taking any new ones