What insurance should I be looking at a solo FTB with no dependants in my early 30's?

cherryblossom123

Hi,

I am just about to complete on my first home.

I've been so wrapped up in everything else that I have neglected to think about insurance, I am not sure what I should be looking at.

Of course I will be buying buildings+contents, this isn't about that.

I'm thinking more along the lines of income protection, mortgage protection, critical illness.

I basically want to guarantee I can cover my bills in the event I get diagnosed with a serious illness and I can't work - I'm not sure which of those applies the most, or some combination of all 3?

I have an emergency savings which would last me a little while, probably at least a year, but after that if I couldn't work, I still want to be able to live. Maybe if I could get a lump sum to just pay off my mortgage if I got some terrible condition and couldn't work.

I have no dependents so in the worst case, I don't really need to leave anything behind. Plus work would offer 2x my salary anyway.

So to summarise I just want to be covered for if I get seriously ill. At the moment I've got nothing that would cover me in that event - should I just get critical illness to the amount of my remaining mortgage balance if I got some horrid condition, or what would you suggest.

I can also buy through work but I'm not too sure about this really, because it says group policy and I won't get any documentation so I'm confused.

Very new to this so really want to understand my options. Thank you!!!!!

Thanks everyone.

kingstreet

Permanent health insurance/income protection first. Get "own occupation" cover to make a successful claim more likely. Critical illness cover can be added to make adaptations/convalescence possible, but remember the condition you suffer has to be on the list and of sufficient severity; where with IP/PHI you simply have to be unable to follow the duties of your usual occupation.

DullGreyGuy

Income protection is a marketing name that is used for PHI and ASU/PPI. They are very different products, even if they have the same superficial aim. PHI is the one you want if you want proper protection. 

MPPI is just another form of PPI

Critical illness is ok as long as you understand it's a lump sum only if you tick all the boxes for a listed condition. You can be very seriously ill but it's not on the list so it doesn't pay out. 

Mark_d

Personally I've never bothered with life assurance/critical illness.  I had income protection for the first 20 years after buying my first place - I'd certainly recommend that.
You'd be in a mess if your house burnt down - so you need buildings & contents insurance.
I also buy boiler breakdown/central heating cover.  My policy includes the annual boiler service and I think it's pretty good value given the complexity of my heating system.
I would only buy insurance if (a) I'd be stuck without it; or (b) I expect a bigger payout than I'd pay in premiums; or (c) it's required under a contract or under the law.

Veteransaver

I'd firstly look at what sick pay you'd get from your employer and go from there. You clearly have some sort of pension scheme which usually has some other life beneftis
Many employers pay 6 months full pay, then may have some reduced protection after that.
Critical illness cover can be expensive, income protection even  more so and it won't pay out for that long. it's all about your risk attitude and as you've no dependents then you should be able to accept some risk.

kingstreet

Veteransaver said:

I'd firstly look at what sick pay you'd get from your employer and go from there. You clearly have some sort of pension scheme which usually has some other life beneftis
Many employers pay 6 months full pay, then may have some reduced protection after that.
Critical illness cover can be expensive, income protection even  more so and it won't pay out for that long. it's all about your risk attitude and as you've no dependents then you should be able to accept some risk.

PHI can pay until retirement if that's the term you choose at the outset. You would tailor the waiting period to the time you would expect employer sickness benefits to continue and the longer the waiting period, the lower the premium. PHI can be expensive for a class four manual occupation and short waiting period, but for many with the employer benefits you mention linking that to a lower class occupation shouldn't break the bank and the benefit is paid free of tax too, so a lower amount of benefit can cover more of a gross salary.

DullGreyGuy

Veteransaver said:

I'd firstly look at what sick pay you'd get from your employer and go from there. You clearly have some sort of pension scheme which usually has some other life beneftis
Many employers pay 6 months full pay, then may have some reduced protection after that.
Critical illness cover can be expensive, income protection even  more so and it won't pay out for that long. it's all about your risk attitude and as you've no dependents then you should be able to accept some risk.

PHI pays out for as long as you are too unwell to work until whatever day you specified... normally a date in your mid-late 60s. 

You are thinking of ASU/PPI which is limited to 12 or 24 months -v- the 30+ years for PHI. Its time limit is not the only problem however but the fact it is an annual policy so you have no idea what next years premium is nor even if your insurers is going to offer the policy next year.  

Unfortunately you have fallen into the trap that marketing departments want by confusing the two products that are sold under the same name.