Insurance - what are your priorities?

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Priority image Everyone understands the concept of insurance. You pay a premium for a policy which covers you against certain risks. It is generally accepted that the policy premium costs you less than you'd pay if you suffered one of the risks.

Most people will make a judgement based on the likelihood of loss versus the cost of the insurance. For many, they never claim against an insurance policy, but it does provide peace of mind to know they have a financial safety net should something happen.

Some insurance is compulsory. You can't drive a motorised vehicle legally on public roads without having at least third party insurance. A lender won't give you a mortgage unless you have adequate buildings insurance in place. Other insurances are optional. Many people take out contents cover along with their buildings insurance. Animal lovers have come to appreciate the value of pet insurance to cover against expensive veterinary bills. Mobile phone, household appliance and car warranties are all popular insurance policies as well.

There is, however, some insurance that people frequently neglect. What happens to all of the above insurance policies if there is no longer any money to pay for them? This could be the case if you are unable to work due to illness or are made unemployed. You've probably guessed, and yes, there are insurance policies available to protect against loss of income.

You may be surprised at the relative risks and costs.

Statistic Monthly cost of insurance policy1
2.1% - risk of being a victim of domestic burglary2  £16.274
3.8% - risk of being a victim of vehicle related theft2  £70.845
4.5% - risk of being a victim of bank or credit card fraud2  Not applicable
4.0% - risk of dying3  £8.326
13.0% - risk of being diagnosed with a critical illness3  £38.237
31.0%- risk of being off work for two months or more3  £18.848

The statistics show you're significantly more likely to be off work, potentially without any income while you're off. How would you continue to pay your mortgage, home and car insurances under such circumstances? An income protection policy may be less expensive than you think, and will help to ensure you can continue paying all your other bills if your income is interrupted.

For a personalised quote get in touch with us. It is no obligation and won't cost you anything. At least make finding out how you could protect yourself a priority!

1 Costs are illustrative and do not represent a personal quotation. Premiums will depend on individual circumstances.
2 Crime Survey for England and Wales - year to June 2017.
3 Based on a 30 year old male non-smoker suffering the risk before age 67. Statistics from Royal London - Hannover Re's interpretation of the Institute and Faculty of Actuaries' Continuous Mortality Investigation insured lives incidence rates together with their estimate of future trends.
4 Compare the Market quote based on 3 bedroom semi-detached property in M6 postcode. Building cover unlimited, contents cover £50,000, no voluntary excess, excludes accidental damage, zero no claims discount.
5 Compare the Market quote based on 2016 registration Vauxhall Corsa Design Vvt, 1229CC Petrol, 5DR, Manual. Value £6,700, zero no claims discount, kept on driveway in M6 postcode, third party fire and theft, SDP commuting.
6 Quote based on 30 year old male non-smoker, occupation teacher for level term assurance of £200,000 for 20 years with terminal illness cover and waiver of premium.
7 Quote based on 30 year old male non-smoker, occupation teacher for critical illness cover of £200,000 for 20 years. Combined life and critical illness cover on same basis would be £40.23.
8 Quote based on 30 year old male non-smoker, occupation teacher with annual salary of £35,000. Monthly benefit £1,750 for policy to age 68, six month deferred period. Low-cost option which pays out for up to 2 years each claim.