Income proection and critical illness insurance

KERRY

Hi everyone. I'm new to this site and am looking for anyone who can give me some advice please.
I am in process of re mortgaging my house as ive come to the end of my 2yr fixed rate. Just taken out new fixed rate and my mortgage advisor has recommended that i take out both critical illness (£30 per month) and income protection (£45 per month) with deferred to after 52 wks.

Should i go ahead with these - am really confused!!!! I am 32, single with no dependents. I work full time as a primary school teacher.

HELP!!!!

dunstonh

Should i go ahead with these - am really confused!!!! I am 32, single with no dependents. I work full time as a primary school teacher.

Based on your employer benefits and the very very limited facts we know, the products meet your generic needs. Although at 32, being a teacher and having 52 weeks deferment, the £45 seems quite expensive for PHI. Although you havent mentioned the terms.

Februarycat

I have just taken out a income protection insurance today and mine was £14 a month.

MishterTea

18 months ago I took out Accident, Illness and Unemployment cover with BestInsurance.co.uk. I was 25 at the time and pay £12 per month. I was offered a similar deal to you through my broker and refused as I know you end up paying a premium.

dunstonh

I have just taken out a income protection insurance today and mine was £14 a month.

Different product to what the OP has. You almost certainly have budget payment protection. Not permanent health insurance.

18 months ago I took out Accident, Illness and Unemployment cover with BestInsurance.co.uk. I was 25 at the time and pay £12 per month.

Also a different product. Again its the budget payment protection you have.

The teachers benefits are more or less 100 days full pay and 100 days half pay. Going with the budget options both the above have would be a waste of money as the payment protections couldnt pay out in the first 100 days and would only pay out around 10% for the next 100 days. So, the advice given by the adviser is sound. 6 months deferment may be better but there isnt a perfect match for the 200 days of sick pay you already have from the employer.

I was offered a similar deal to you through my broker and refused as I know you end up paying a premium.

Better to pay more for something that will benefit you rather than pay less for something that will not.

Its a common error we see often in this section where people buy payment protection insurance called income protection and think they have proper income protection but they dont. Anyone moving from permanent health insurance (PHI) to ASU/MPPI is degrading the benefits, cover and overall chances of a successful payout.

Ianh82

thats very expensive. i'm 34 and single and remortgagin and my advisor said ipt is the best for me and i found it for £14 paid after 8 wks (my companies sick pay rules)

shop around as there are much better deals than that. my full death, critical illness cover for a couple was only £45 a mth.

lisyloo

thats very expensive. i'm 34 and single and remortgagin and my advisor said ipt is the best for me and i found it for £14 paid after 8 wks (my companies sick pay rules)
shop around as there are much better deals than that. my full death, critical illness cover for a couple was only £45 a mth.

By all means shop around, but heed what dunstonh says.
Some of these posters are probably not comparing like with like, so you need to be clear on the quality of the cover.
There is no point saving money and getting an inferior policy if it doesn't suit your needs.

dunstonh

thats very expensive. i'm 34 and single and remortgagin and my advisor said ipt is the best for me and i found it for £14 paid after 8 wks (my companies sick pay rules)

Once again, its not the same product. Yours is the budget payment protection. Not PHI.

shop around as there are much better deals than that. my full death, critical illness cover for a couple was only £45 a mth.

With respect and making some guesses, that sounds like you have reviewable premiums (not guaranteed) and budget payment protection (and not PHI).

Please make sure you are comparing like for like. The OP has been recommended PHI income protection which is full income protection until selected end date (typically retirement). Those that have responded have the budget option which only pays out for 12 months (some may go to 24 months).

PHI is medically underwritten at point of sale and has a far higher successful claims rate than ASU/MPPI (not difficult as 86% of payment protection claims are rejected - 2006 figures).

If the OP was to go for an ASU/MPPI they would not get a payout for 100 days and only a small amount for the next 100 days despite the ASU/MPPI saying it will kick in after 30 (or similar).