Types of Protection
Choosing the right cover can help ensure your family remains in their home and maintains their lifestyle, even when life takes an unexpected turn.
Life Cover
Life cover is designed to provide financial security for your loved ones in the event of your death. In the context of a mortgage, it can help pay off the outstanding balance, ensuring your family may remain in their home without the burden of monthly repayments, subject to policy terms.
- The main earner passes away unexpectedly.
- Protecting the family home for dependants.
- Clearing joint mortgage debts for a surviving partner.
Critical Illness Cover
This cover may pay out a tax-free lump sum if you are diagnosed with a specified serious illness covered by your provider. It can help bridge the financial gap if a serious illness stops work, allowing you to focus on recovery rather than mortgage repayments, insurer criteria applying.
- Diagnosis of a covered serious condition like cancer.
- Adapting your home after a health setback.
- Managing living costs while unable to earn an income.
Income Protection
Income protection aims to replace a percentage of your earnings if you are unable to work due to accident or long-term sickness. This regular payment can help you keep up with mortgage repayments and essential bills, subject to the policy wait periods and insurer terms.
- Long-term sickness reduces your monthly income.
- An accident leaves you unable to perform your job.
- Ensuring consistent mortgage payments during recovery.
As with all insurance policies, conditions and exclusions will apply.Â
The cost of this insurance depends on several factors, such as your age, where you live and your occupation. As a result, the cost you will pay is based on your own circumstances.
Common Questions
How does protection insurance benefit my family?
Protection insurance provides a financial safety net, ensuring your family can maintain their lifestyle and stay in their home even if the unexpected happens.
Can I get coverage if I have a pre-existing condition?
Yes, many providers offer options for those with pre-existing conditions. We work with you to find the most suitable coverage based on your specific health history.
What is the difference between life and critical illness cover?
Life cover pays out in the event of death, while critical illness cover provides a lump sum upon diagnosis of a serious specified condition, helping with recovery costs.
Is the payout from protection insurance tax-free?
In most cases, the lump sum payout from a protection policy is currently free from UK Income and Capital Gains Tax, though Inheritance Tax may apply.
Protection in Action
The Jones Family
When Mr Jones was diagnosed with a serious illness, his Critical Illness policy paid out a £150,000 lump sum, clearing their mortgage and allowing him to focus entirely on recovery without financial stress.
Sarah's Safety Net
After a workplace accident left Sarah unable to work for six months, her Income Protection policy provided a steady monthly payment that covered all essential bills and mortgage repayments until she returned.
Securing a Future
Following an unexpected tragedy, a Life Insurance policy ensured that the family home was fully paid off, providing the grieving family with the stability and peace of mind they needed during a difficult transition.