Chapter 2 Flashcards
What are the main areas of need for protection?
- health, incapacity or accident
- income, mortgage or other debt
- death
- asset protection
- business protection
Name 2 types of insurance that will help mitigate the effects of being off work through accident or illness.
- income protection
- accident, sickness & unemployment insurance
What is usually the most appropriate insurance for a single person without dependents who is buying their first home?
-income protection
Why might a child be dependent on their parents after age 21?
-disability
What are the advantages and disadvantages of employer-provided benefit?
- bulk buying = possibility of negotiating better terms
- for those with dependents, the total is often not enough
Why should protection be reviewed after a divorce or dissolution of a civil partnership/ long-term relationship?
-as the needs & requirements may have changed
Can critical illness cover be combined with life cover in one contract?
Yes it can
For a person aged 35, is the risk of being off work ill or accident, greater than the risk of death?
Yes
What is the current standard nil-rate band for IHT?
-£325,000 - over this is 40%
Why might an employer be able to get cheaper private medical insurance premiums than an individual?
-bulk-buying/ negotiating better terms
What is the extent of insurable interest for a divorced spouse in their ex-spouses policy?
-limited to the maintenance paid/ any other loss due to the death of the spouse
Name four areas of need for protection.
- health, incapacity or accident
- income, mortgage or other debt
- death
- asset protection
- business protection
Why is insurance against unemployment usually limited to the repayments on a mortgage or loan?
–unemployment is difficult to predict
Why might it not be in the client’s interest to replace an existing critical illness policy even though the quoted premium may be cheaper?
- the previous terms may have been better in terms of coverage
