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Building and protecting your wealth

You Dont Have to Be Rich To Protect Your Income, Your Health and Your Wealth

It’s imperative to understand supplemental coverage available to help you and your family make it through tough times in case anything were to happen to you and working wasn’t an option, even just for a short time. There are three primary avenues to explore for protection — Life Cover, Critical Illness Cover, and Income Protection.

This does not constitute advice and advice should be sought in all instances before acting on it.

Out of the three, life cover is generally the most popular as it can be tied to a mortgage (many policies even offer a mortgage guarantee), while critical illness is mostly added as part of a combined life or earlier critical illness plan, and income protection is sometimes tacked on afterward.

While this is the standard approach for some, we’ve covered why income protection is actually extremely valuable in the past and shouldn’t simply be viewed as an afterthought.

Life Cover

Life cover is a type of insurance that pays out money to your dependents after your death. This lump sum will help them keep up with the mortgage and bills — anything that you would normally pay for but will no longer be able to.

Policy costs will vary based on your age, health, and lifestyle. Life cover is unique amongst these three types of protection as it only pays out after the policyholder has passed away.

Income Protection

This is a long-term insurance policy that covers your earnings in the event of illness or injury. The key to Income Protection (IP) is that it pays out up to 65% of your gross income on a monthly basis if you are unable to work.

Payments are available until you retire, and you can make multiple claims during the life of the policy. The best part about IP is that it covers nearly any medical issue that prevents you from working, a key distinction from critical illness cover.

Critical Illness Cover

This type of insurance also provides coverage if you were to become ill or injured and unable to work, but it will be a lump sum, much like life insurance. There are also a limited number of “critical illnesses” that are covered so be sure to review your policy so you’re aware what’s included.

You can tie in critical illness cover with a life insurance policy and you can also take out a joint policy with your partner. Critical Illness cover is not tied to your income so your plan can cover as much as you’d like, but you will only be able to claim one time before your policy is discontinued.

Choosing the right cover for you

When deciding on coverage after an illness or an injury, many people find themselves torn between critical illness and income protection as they are very similar. We’ve discussed why income protection might be the better solution if you have to choose between the two, especially if you are self-employed.

However, for complete peace of mind, it’s best not to have to choose and to have both. You can use critical illness cover’s lump sum to help pay one-off hefty expenses and let income protection’s regular payments help you for a longer period of time.

Of course, the ideal situation would be to be covered from all angles — Life Cover, Critical Illness Cover, and Income Protection — a triple threat. You’ll have maximum protection from losing your income, falling ill, and protecting your home for your family in the event of your death.

We can help you choose the right protection

Here at Dental & Medical Financial Services, we specialise in developing and protecting your wealth and our expertise includes helping you find the right mix of protection for yourself, your family, your home, and your income.

Get in touch with us today to get a wealth protection solution designed specifically for you.

Need help to protect your wealth?
Investments | Financial Planning | Retirement | Save Tax | Protection |

Dental & Medical Financial Services have been helping doctors and dentists to build and protect their wealth, whilst saving tax for over 25 years.
Call Darren to discuss your options.

Tel: 01403 780 770


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