How protected are you? Five protection insurance myths – exposed.

Monday, 2nd December, 2013

Insurance has moved on a long way from where it used to be. In fact, regulation and media pressure, combined with a more clued-up and unforgiving public, has meant that the insurance industry is now more transparent than it ever has been.

As an independent insurance broker Complete Mortgages provides its customers with a range of products including property insurance and mortgage protection, which are relatively straightforward and well understood by the public. It’s critical illness cover and anything involving a life insurance policy that people, in our experience, are often more wary of.

So, in a bid to help make protection insurance as clear as possible and debunk the five common myths associated with this type of product, here are five tips to keep in mind when considering taking out a protection insurance policy.

It never pays

According to Protection Review, an industry watchdog headed up by industry experts, the general public consensus is that only around 38 per cent of protection insurance claims get paid. However according to Protection Review the actual figure is over 90 per cent. Not only that but according to the organisation these claims are paid promptly, too.

The state will look after me

Yes, the state will pay you money if you are unable to work due to illness or disability – but it only equates to £71 a week for those over 25. This rises to £100 after a period of 13 weeks however a pay out from a private insurance provider is much higher. Not only that, but the state won’t pay out when you die – a life insurance policy will.

It won’t happen to me

Hopefully not. But it has to happen to someone and as research shows, over one in three people are likely to suffer from cancer and countless accidents happen each and every day, some minor and some fatal. Either way, it’s enough to potentially have a catastrophic impact on you and your family. Having something in place will at least take away one major concern if that time ever comes.

My employer will look after me

Whilst a health insurance plan is often part of an employee’s salary package, over 75 per cent of employers do not provide life insurance cover for their employees. If long-term sick leave were required then the employee would qualify for statutory sick pay at £86.70 a week for the first 28 weeks. Again, payouts from a private policy would be much higher.

I can’t afford it

The average cost of a protection policy is £27 a month – about the average cost of a family takeaway meal. It really isn’t as much as people generally expect and given the long-term implications if you don’t have it, maybe the question is whether or not you can afford not to have it!

If you don’t work in insurance then it’s likely that the thought of finding the right policy for you is probably enough to stop you in your tracks. That really doesn’t have to be the case. As an independent insurance broker we’re here to find you the product that works best for you and your family’s lifestyle.

So, whether you’re a doctor, a builder or a racing car driver, get in touch with one of the team on 01483 233014 for an insurance quote or to find out how we can help protect you and your family. Alternatively email our insurance specialist Carolyne Fairfull on carolyne@complete-mortgages.co.uk.