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Do I really need an insurance Policy?

YES. Our answer at Clements Financial is a definite yes. Many people believe that insurance policies are expensive and that an insurance policy will not ‘pay out’ when needed. However, this is just not the case. It may be challenging to afford insurance, but our lives are the most valuable asset that we have. Insurance policies are not just for the person who is insured, they are also a safety net for the people in their inner circle, who may even depend on them for financial support. Our advisors provide guidance on the most suitable protection plans for you. Updating your life cover to reflect changes in circumstances will also give you the most appropriate level of cover.

What is an insurance policy?

An insurance policy is a contract between the policyholder and the insurance provider to ‘cover’ occurrences specified in the taken insurance policy. The cost of the policy will depend on your own circumstance and there are a variety of different policies covering different elements of insurance that you can choose from. 

What is an insurance policy based on?

Insurance policies are created based on the risk of the event being covered actually happening. Therefore your personal financial or health situation will determine a custom policy based on you. For life insurance, your age, lifestyle and health are huge factors. Whereas Critical Illness cover will be based on your health and family health history as well. Other policies may be based on your income and assets. The information you provide is what the policy will be based on – honesty is essential. For example if the medical questions or smoker status is incorrect, your policy will not pay out for any claims. Reviewing your insurance policies frequently will protect you from this.

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What insurance policies do I need for a mortgage?

We offer the essential policies which you should consider when obtaining a mortgage. Paying a mortgage is a huge responsibility, you should protect yourself in the event that you may no longer be able to pay it. We can provide you with the following insurance policies:

  • Life insurance
  • Critical illness cover
  • Income Protection
  • General Insurance

You can take out multiple policies, we will explain what each policy will cover you for and the different options available. 

What is Life a Insurance policy?

Life insurance is a policy which covers you in the event of your death. A designated person will receive a lump sum of the amount you have chosen at the application stage. Some people choose to insure themselves for the mortgage amount; others insure themselves for a higher amount. Choosing a higher amount ensures the mortgage would be paid off and there would be an amount left over to support the remaining family members.

What is Critical Illness Cover?

This insurance covers you for serious illness, with most illnesses this could impact your ability to provide for your family and work. Like life insurance, this is up to yourself how much you insure yourself for. Around 1 in 2 people in the uk will be diagnosed with some type of cancer within their lifetime, so this is a hugely important policy to think about.

What is Income Protection?

Income protection insurance pays you a regular income if you can’t work because of sickness or disability, and can continue until you return to work. This type of insurance is especially great if you only have limited employee sick pay or are self employed with no provisions. Unlike critical illness, this protection covers you for not just critical illnesses.

What is General Insurance?

General insurance provides cover for your buildings and contents in your home. You can cover your home against fire damage, flooding, theft or break ins and loss or damage. There are various options available for different amounts, specific values and layers of coverage.

What kind of terms do insurance policies have?

There are different types of terms you can get in an insurance: level term and decreasing term. With a level term life insurance policy, an amount of money will be pre agreed and paid on death to the beneficiary. Alternatively, a decreasing term will decrease as through the policy length, therefore the payout amount will also decrease. Generally insurance policies are a level term policy, however a decreasing policy is available for Critical illness and life insurance. 

Why should I get insurance?

We recommend that our clients take out insurance to avoid the risks that life throws at us. Statutory sick pay does not always cover all bills, many homeowners experience unavoidable breaks in work or employment. Unfortunately the likelihood of getting a critical illness is a very real possibility. And finally, if the worst were to happen and you were to die – life insurance covers those that you leave behind. It can feel uncomfortable to think about the negative things that could happen, but for some people these conversations turn into a reality. Also once you have had a critical illness, you will find it much more difficult to get insurance at an affordable price. We believe that it is important to prioritise taking out the correct insurance to protect your personal situation. We have access to a variety of policies and service providers for insurance.