Family Protection
Family Income Benefit protects a level of income for a fixed term. In the event of death, the amount of income chosen at the outset will be paid for the remainder of the term of the plan. Often the term is set to protect you until your youngest child is 18 or 21.
Family Income Benefit is one of the least expensive forms of life insurance and differs from most other types in that it is designed to pay the benefit, in the event of death, as an income rather than a lump sum.
Depending on your circumstances, indexation might be an option for this type of plan to protect the purchasing power, although the benefit can be level. If indexation is elected at the outset, the premiums and benefit would rise annually, normally by Retail Price Index
In the event of a claim, income can be paid monthly, quarterly or annually and under current rules the income is tax-free. This makes it ideal for Family Income Protection where a family are looking to insure the main breadwinner over a specific term, for example to his or her retirement age.
Family Income Benefit can also include Critical Illness Insurance which is designed to pay the selected income if the policyholder is diagnosed with a critical illness within the chosen term. Critical illness conditions vary from insurer to insurer. Plans may not cover all definitions of a critical illness. The definitions vary between product providers and will be described in the key features and policy document if you go ahead with a plan.
Family Income Benefit therefore should be considered when looking to effect insurance for Family Income Protection. Family Income Benefit is a low cost, tax efficient solution to Family Income Protection.
Family Income Benefit can also include Critical Illness Insurance which is designed to pay the selected income if the policyholder is diagnosed with a critical illness within the chosen term. Critical illness conditions vary from insurer to insurer.
Family Income Benefit therefore should be considered when looking to effect insurance for Family Protection. Family Income Benefit is a low cost, tax efficient solution to Family Protection.
TERMINOLOGY
Decreasing Term
is where the amount you would receive in the event of a claim remains consistent for the period selected (in addition you may have the option to “index” the cover).
Level Term
can also be known as “Mortgage protection”. This is where the amount of cover you have opted for will decrease over a set period of time. Therefore it may used to cover a decreasing loan such as a mortgage.
WHOLE OF LIFE
a life only plan that will pay out whenever you die (no upper age limit)
INDEXING
can also be known as “Mortgage protection”. This is where the amount of cover you have opted for will decrease over a set period of time. Therefore it may used to cover a decreasing loan such as a mortgage.
These plans have no cash in value at any time and will cease at the end of the term.
If premiums are not maintained, then cover will lapse.
CRITICAL ILLNESS PLANS MAY NOT COVER ALL THE DEFINITIONS OF A CRITICAL ILLNESS. THE DEFINITIONS VARY BETWEEN PRODUCT PROVIDERS AND WILL BE DESCRIBED IN THE KEY FEATURES AND POLICY DOCUMENT IF YOU GO AHEAD WITH A PLAN.
When having a consultation with Wyke Financial we will consider your specific Protection needs and arrive to an agreed proposal that is both considerate of your circumstances and budget. We aim to outline for you the different areas of insurance cover we can provide and what cover they offer.
Other types of insurance such as buildings & contents or Landlords Insurance will be listed under GENERAL INSURANCE It would be worth your time having a read of the sub sections below so that you can decide prior to your appointment which type of cover is appropriate to you and your circumstances. Although we will of course advise you and recommend an appropriate protection product or package from our panel.