Life Assurance
The cost of life assurance depends on two factors:
- How much cover do you want?
- How long you want it for?
Then you age, sex, occupation, health & smoking habits are taken into consideration. The other issue affecting premiums is your medical history & current state of health.
Mortgages
How much mortgage cover do I need & for how long?
You need to cover the amount of the outstanding debt, up until the debt is paid off.
What type of cover do I need?
Is your mortgage a repayment one? If so, you need a Decreasing Term Assurance policy.
Or is it an interest-Only mortgage, in this case you need a Level Term Assurance policy.
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A common concern when talking about various insurance scenerios is whether the insurance company will pay out on the claim. The answer is pretty straight forward for life assurance, but confusion can arise with so many different types of other insurance available and an array of different qualifying criteria.
However, recent research published by Moneyfacts looking at Critical Illness cover reveals that such concerns may be increasingly unfounded. In their findings they state that the total number of claims that did not get paid due to non-disclosure (this is when someone fails to disclose a material fact, such as, a previous illness or a underlying medical condition) has dropped to less than 2%, and the average payout has increased to 90.5% of all monetary claims made. This has increased significantly from 2008 when the figure was closer to 75%.
In summary, insurance companies are paying out more claims, but when you fill in any application the best advice is for full disclosure, noting any previous medical issues no matter how small they were. Only then will you have 100% peace of mind.
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Rather morbidly any conversation with a Mortgage Broker usually involves a question about whether you need life assurance to protect your mortgage in the event of death. However, in reality, the chance of a client actually dying during a mortgage term is small – they are in fact much more likely to suffer illness, accident or even a period of unemployment.
In light of the above, it is therefore these types of incident that should also be protected against rather than just dealing with the question of death. Whether this is for short-term cover for a maximum period of 12 months or if you require cover right up to retirement age there are policies that can be tailored to each client’s specific needs. There are even policies available that will reduce the monthly premium if you are a gym member and can evidence the maintaining of a level of fitness going forward.
If you would like to know more about such policies please contact me.
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I was recently asked to meet a client in our Histon office. The clients had offered on a property, but unfortunately so had another two purchasers and they ended up losing out on the property. Obviously disappointed they decided to cancel my appointment but upon speaking to them I stressed the benefits of being fore-armed when going into competitive bidding situations and the meeting duly went ahead.
The clients were quite well prepared and had clearly done a lot of homework so they arrived with a handful of quotes and a brief for me to double check their research and to point them in the right direction. However, better than that I was able to source a much better deal suited to their personal circumstances from a small Building Society that did not appear on the comparison websites that my clients had checked.
The mortgage package that we beat was £1076 per month over 30 years. We were able to reduce the term to 25 years and reduce the cost to £918 per month. We were also able to reduce the cost of their Building and Contents by £14.86 per month, and their life protection was also reduced by £19.23 per month. In total a saving of just under £200 per month but more importantly the term of our selected deal was 5 years shorter, saving thousands in the longer-term.
A significant saving but more importantly it gave them the confidence to be more bullish when they found another property and I am pleased to confirm that they are now looking forward to moving into their new home. Simples.
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Great news! No downward spiral here!
I recently had an enquiry about arranging life assurance for an American client. Under normal circumstances insuring a fit non-smoking forty something academic is reasonably straight forward. However, my learned transatlantic comrade has an unusual pastime; he sky dives up to 75 times a year. As you would imagine this leads to huge underwriting problems with nearly all insurance companies. They view this type of application as a larger than normal risk and typically charge up to three times the standard premium, when compared to those of us who keep our feet on the ground.
But persistence pays off! I found an insurer who offered cover to the client on standard rates because they took the time to listen to the fact that the client has been sky diving for twenty years and that he actually holds a recognised licence certifying his competence. So with a bit more effort and a personal approach on my part we were able to provide the client with the right level of protection and, as importantly, at a realistic price. I would like to see the price comparison website that can do that!
If anyone would like to discuss their life assurance needs please do not hesitate to contact me.
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