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What is Family Income Benefit (FIB) and How Can It Give Peace of Mind to Your Loved Ones?

If the current global coronavirus pandemic has taught us anything, it’s to expect the unexpected. If you’re looking for an inexpensive solution to help protect your family financially after you’ve passed, consider Family Income Benefit (FIB) insurance.

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

FIB insurance a special type of life insurance policy that provides regular pay outs to your family for a set period of time after your death as opposed to a lump sum like with other types of life insurance policies.

How does it work?

When you first take out a FIB policy, you’ll determine how much income you’ll provide for your family and for how long. From there, your insurance provider will calculate the monthly premium that will be required to secure the cover you need.

After you pass, your family will receive regular tax-free income pay outs so you can rest assured that your family will be provided for if you die during the term of the policy. Be sure to review all your options as some providers may also cover earlier diagnosis of a critical illness in their policy too.

Exactly how much the policy will end up paying out is entirely dependent on when the policyholder dies.

For example, if you have a 30-year policy, whatever amount you’ve settled on for monthly payments to your family would be paid out for the remainder of the term. So, if you died halfway through at 15 years, they’ll receive payments for the final 15. If you die after the policy ends, your family won’t receive anything at all.

Compared to a lump-sum pay out life insurance policy for the same time period, Family Income Benefit insurance is an inexpensive solution because your loved ones get less money overall the longer you live.

How can it give you and your loved ones peace of mind?

First and foremost, it is an economical way to ensure your family won’t worry about money after you die. As it pays out in regular increments, it will help ensure your family is taken care of in an established time frame. For those with young families, this is the perfect way to ensure your family needn’t worry about finances at least until your children are older and can fend for themselves.

It might be hard for family members inexperienced with managing money to handle a lump sum, especially after a tragic event. Financial affairs are the last thing you want your family to be concerned with after your death, so you should prepare as much as possible before that happens.

FIB insurance should be used in tandem with another type of policy that distributes lump sums in order to cover debts like the mortgage as your family would be covered for everyday expenses.

Ask the experts

In order to ensure you won’t leave any debts behind and help your family maintain the same lifestyle they were living while you’re healthy and alive, you’ll need a robust wealth protection and preservation plan. To determine how Family Income Benefit insurance can fit into your financial plan, get in touch with our lead financial adviser to discuss your options today.

How can you protect your family?
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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