Protection
There are three main types of protection products, these are explained below.
Whole of Life: This provides cover in case of untimely death and/or diagnosis of a critical illness. This is most commonly used for Family Protection and contains an investment element so can be modified as needs change.
Term Assurance: Level Term Assurance provides protection for a fixed term and is commonly used against a loan until the capital is repaid. some people also use this as security in case of death/diagnosis of critical illness until the family is grown up. Reducing Term Assurance often known as Mortgage Protection is commonly used for security against a capital repayment mortgage.
Income Protection: This provides protection in case of loss of earnings due to sickness, an accident, etc. The most comprehensive and expensive is payable until a given age e.g., 60 years, or the ability to return to work, whichever is earlier. A different deferred period can be chosen to fit in with any other period of benefit provided by the employer. Shorter term protection, commonly known as mortgage payment protection is usually a cheaper option but only provides cover for 1-2 years.
There are also other options such as Family Income Benefit which can provide family cover paying regular income to provide for children should the breadwinner(s) die prematurely.
The above is a brief senario and a more detailed explanation can be provided by giving us a call.