r05 week 1 Flashcards
Mortality =
Death
Morbidity =
Illness or Injury
How big is the life insurance gap?
2.4 trillion
% of UK who have life insurance?
50%
The UK is ranked _ in world protection side
3rd
Why does the protection gap exist?
Cost and Lack of understanding + advice
What is the financial planning equation?
Wants minus gots = needs
What are the three main sources of support?
Yourself, Employer, State
Term Insurance =
Insurance for a set ‘term’ of time and then stops
Whole of Life =
Policy which lasts all of life. pays out on death
endowment =
Savings plan with life cover
Income protection
Pays income when you are sick and can’t work
Critical illness
Lump sum on diagnosis of critical illness
Private medical insurance
Pays for private medical cover when sick
Long term care
Covers care in old age
Commoditisation in the protection market means?
Commoditisation is where financial protection products are purchased via the internet without the help of a financial adviser.
State benefits - Means tested =
Benefits are based on an individuals broader resources and money
State benefits - Contribution tested =
Benefits are based on whether enough National Insurance (NIC) has been paid by the individual
State benefits - Needs tested =
Benefits are based on individuals level of need. Not the means or contribution
State pension tax =
Paid without deduction of tax. However, any additional income will be taxed
State pension age =
67
