Protection Issues

Question 1

DIS

Answer 1

Julie’s death in service is linked to employment and will cease to exist when she retires
3 x basic salary = £135,000
Is this sufficient for her boys needs?

Question 2

Life Assurance requirement

Answer 2

Needed in case Julie dies during period of child dependency (maybe up to age 22 if they go to uni)?
Term assurance would keep costs low
FIB policy would be cheapest as it is a decreasing term policy
Could be convertible or renewable if could afford the additional cost
Benefit should be written in trust for children - maybe until 25 to curb irresponsible spending in early 20s

Question 3

Health Insurance

Answer 3

Should she take health insurance with existing provider?
Julie in good health, worth getting quotes from whole market
But if underwriting not required with original provider, may be cheaper
Needed in case unable to work due to incapacity

Question 4

Income Protection Insurance

Answer 4

Arrange maximum for Julie - currently no protection
At least up to state pension age 67, when she gets State Pension and GPP retirement age.
BUT wants to retire earlier…
Maximum cover
Maybe add CIC for a lump sum to cover any additional needs in that circumstance?

Question 5

Peter Insurance

Answer 5

He’s supporting Julie with maintenance

If he dies/incapacitated, payments might stop

Question 6

Peter’s Insurance

Answer 6

He’s supporting Julie with maintenance

If he dies/incapacitated, payments might stop

Question 7

Family Income Benefit

Answer 7

Decreasing term assurance
Cheap/inexpensive
Sum assured to cover annual childcare costs
Index to inflation proof
Pays regular tax free income
Term covers children's need
Guaranteed premiums for affordability
Good health
Simple underwriting process
Can be written in Trust
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