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PROTECTION

It’s important to consider protecting yourself and your loved ones against the unexpected, such as illness or death. One way to do this is through insurance policies. Life insurance, critical illness cover, and income protection insurance can provide peace of mind, knowing that your loved ones will be financially secure in the event of your untimely death or if you are unable to work due to illness or injury. These policies can provide a lump sum payment or regular income, helping to cover expenses such as mortgage payments, bills, and everyday living costs. By taking out these types of insurance, you can ensure that your family is financially protected during difficult times, allowing them to focus on their emotional recovery without having to worry about money.

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Why take out personal protection insurance?

Protecting you and your family from life’s major health events is essential to good financial security. In the event of critical illness or death, who will cover the cost of your mortgage?

Important protection insurance policies to consider taking out include life insurance, critical illness cover and income protection. The benefits of mortgage protection are essential for peace of mind.

In the event of premature death leaving loved ones in a financially vulnerable situation, life insurance is designed to pay out a lump sum. Be it recently married, those with young families, or an individual nearing retirement, life cover can help shelter those most important to you when it matters most.

Critical illnesses can be diagnosed at any stage of life. If the mortgage borrower’s income is relied upon to make monthly payments, critical illness cover can safeguard loved ones with significant financial support in the event of being too ill to work.

If an individual is forced to quit work due to a serious illness or injury, income protection insurance is there to support people financially. It provides important mortgage protection for homeowners to help manage monthly outgoings, including mortgage payments and general outgoings.

To discuss personal protection insurance, contact Diamond Property Finance today.

The Protection Insurance Process

Although we dread to consider the unthinkable, protection insurance is a vital element to safeguarding finances for you and your loved ones once you commit to a mortgage. Talk to our experts today about protecting what’s most important to you.

  • Personal protection insurance can include life insurance, critical illness coverage and income protection.
  • The policyholder’s age, health and lifestyle can affect the amount of coverage and premium available.
  • In some cases, taking out life insurance is a strategy used to reduce the impact of inheritance tax on your beneficiaries.

FREQUENTLY ASKED QUESTIONS

What is income protection insurance?

Income protection insurance is a financial product designed to provide a source of income replacement if an individual becomes unable to work due to illness or injury. It offers a financial safety net by paying out a regular income, usually a percentage of the policyholder’s salary, during the period of incapacity. This coverage helps individuals maintain their standard of living and meet financial obligations when faced with unexpected health challenges.

Can borrowers get 100% income protection?

In the UK, it is generally not possible to obtain 100% income protection. Income protection insurance typically covers about half to two-thirds of your earnings before tax from your normal job, and this is because some money will be taken off for the state benefits you can claim, and the income you get from the policy is tax-free. The specific amount you can claim and the waiting period before the payments start can vary depending on the policy and the insurer. Therefore, it’s important to carefully review the terms and conditions of any income protection insurance policy to understand the coverage it provides.

What is critical illness cover?

Critical illness cover is a type of insurance that pays out a lump sum if the policyholder is diagnosed with a specified critical illness or medical condition. The covered illnesses often include severe conditions such as cancer, heart attack, stroke, or major organ transplant. The lump sum can be used to cover medical expenses, lifestyle adjustments, or other financial needs during the challenging period of dealing with a critical illness.

Is it worth getting life insurance?

Whether life insurance is worth it depends on an individual’s financial situation, responsibilities, and goals. Life insurance provides a payout to beneficiaries upon the policyholder’s death, offering financial security and assistance with funeral expenses, debts, or ongoing living costs. It is particularly beneficial for those with dependents or significant financial obligations, ensuring that loved ones are financially supported in the event of the policyholder’s passing.

Who is eligible for life insurance?

In the UK, individuals aged 18 to 85 who are UK residents and have a legal right to live there are generally eligible for life insurance. However, eligibility criteria and restrictions may apply, and some providers may accept customers from age 16, subject to conditions. The amount of cover and the premium cost will depend on factors such as the individual’s age, health, lifestyle, and the type of policy chosen. Some insurers may require medical exams or ask health and lifestyle-related questions to determine the level of risk and the premium cost. While some policies, such as over-50s plans, offer guaranteed acceptance without requiring medical information, the coverage amount may be capped, and the premiums may be higher. It’s important to carefully review the terms and conditions of any life insurance policy to understand the coverage it provides and ensure it meets the individual’s needs.