Financial Focus On...Insurance
13th January 2017 by Robin Beadle
Your car and your house are insured, but are you?
That is the question I pose this month and with good reason. If your car is
involved in an accident, it is very likely that you will be covered by your car
insurance policy. If a personal belonging is stolen, your home insurance policy
may come to the rescue. On holiday, you should often take travel insurance. But
what would happen if you were unable to work through long term sickness, injury
or disability? Or even worse how would your family replace your income if you
Some people delay taking out income protection, “Key-Man” (for business
protection) or life insurance because they think it is likely to be too
expensive, leaving their income, business and/or family vulnerable in the event
of something unexpected happening. But believe it or not, this is not always the
case. Depending on your personal and health circumstances, (or additionally for
Key-Man insurances, the value of the individual to the business) premiums that
can be made for relatively modest amounts can provide a substantial level of
cover ensuring protection for you, your family and your business. As an added
incentive, depending on how a particular Key-Man insurance is arranged, the
premiums for such protection may attract income or corporate tax relief.
Even those of us who like to think we have made adequate provision for our
families by already having income protection or life policies could benefit from
a review to ensure that the cover is still appropriate and up to date. Over
recent years we have seen the insurance market become more aggressive and
competitive which has seen many reductions in the relative cost of cover,
despite the general upward trend in insurance costs generally. The result - even
though policyholders may have aged since an earlier policy was taken out, the
re-pricing of cover by insurance companies could mean lower premiums (or better
benefits) than many existing contracts.
From personal experience, these policies are important. On redundancy,
illness or injury, often the first things to be affected are your credit
worthiness – often when you need it most.
But a note of caution with an important point – make sure that your
application forms are completely accurate and truthful. In exactly the same way
as non-original alloy wheels can affect a motor insurance policy, by being
conservative with information when form filling could cause trouble in the
future should you need to claim. An unfortunate case a few years ago saw an
individual failing to give sufficient detailed information about their drinking
habits when completing the health questions. Following the untimely death of the
policyholder, the insurance company are now strongly contesting paying out the
sum assured due to non-disclosure!
For further information on any of the above points or to discuss your tax
affairs generally, please do not hesitate to contact Robin Beadle.
« Back to blog