Personal Protection
The Bank have said I need to have a policy to cover my borrowings. Do I need to take it out with them?
No. Banks cannot make it a condition of borrowings that you effect a policy through them. HW Financial Services Limited may well be able to obtain more competitive rates for you, so ask to arrange a quote.
How much life cover should I have?
The amount of life cover you should have depends on your individual circumstances, as a guide couples with young families should consider a level of cover around 10 x net annual income. As you get older the need for such cover does not diminish and can be an integral part in Inheritance Tax mitigation strategies. Speak to HW Financial Services Limited to ensure that you and your family are adequately covered.
Does an Income Protection policy provide a regular income if I become unemployed?
Not normally. Unemployment policies generally provide cover for a defined period and sometimes only for specific items such as your mortgage. HW Financial Services Limited can review your existing cover to make sure that it can provide the peace of mind you need.
What is Permanent Health Insurance (PHI)?
PHI Is a policy that will provide you with a regular income in the event that you are unable to work as a result of long term illness or incapacity. It is designed to replace some but not all of your regular earnings. BE CAREFUL though. These policies have different conditions and unless you check you may find that nothing will be paid if you can still undertake alternative work to your previous occupation.Ask HW Financial Services Limited to provide you with an appropriate quotation or an independent assessment of your existing cover.
Is there a limit to how much of my earnings I can protect?
Yes. Unsurprisingly the insurers would like claimants to go back to work. However it may well be possible to include payments for items such as pension contributions in the cover. Ask HW Financial Services Limited to find out how much you can actually insure yourself for.
Why should I consider a Critical Illness policy?
The chances of you contracting a 'dread disease', for example cancer, or suffering a stroke, are statistically high. Owing to medical advances, the chances of surviving but having an impaired life or shortened life expectancy are also high. You may not wish to, or be incapable of, earning income to meet your liabilities such as your mortgage or pay for essential alterations to your home. Discuss this important issue with HW Financial Services Limited in order to secure your peace of mind.
Can I save tax by taking out a protection policy?
Yes. Life cover can be provided through a pension policy which attracts tax relief. There are however certain legislative restrictions which HW Financial Services Limited will gladly investigate for you.
I am leaving my employer and will lose the Private Medical Insurance they provide. I want to keep the protection, but must I stay with the same insurer?
No. Many schemes will offer an individual replacement policy taking into account your claims history. Check this with HW Financial Services Limited to confirm if the policy offered is competitive. You can also sometimes be offered an individual plan with your previous employers insurer. This may be more beneficial as they may disregard any health problems you have developed. This is a complicated area and one which must be carefully looked at.
Are these policies expensive?
If you can guarantee that nothing is going to happen to you, your partner, or your family, then this is an additional cost that may be considered unnecessary. However, in context to what you or your family may lose, in our opinion, the policies are not expensive.
HW Financial Services Limited are Independent Financial Advisers, authorised and regulated by the Financial Services Authority and owned by Bestinvest (Holdings) Ltd. This webpage has been produced for the general information of our clients. It is based on our understanding of current legislation and is intended to provide a brief summary thereof. It is not intended to give personalized investment advice and you should contact us or them before taking any action based on the information therein. You should be aware that where past performance is quoted for specific funds or asset class sectors (such as property funds) it is not a guide to future performance and that the value of unit-linked investments is not guaranteed. As unit prices can go down in value as well as up you may not get back the full amount of your investment. All statements concerning the tax treatment of products and their benefits are based on our understanding of the current law and HM Revenue and Customs practice and are for general guidance only. Whilst every effort has been made to ensure accuracy, no liability can be accepted for any errors or omissions. Levels and bases of, and reliefs from, taxation are subject to change.