Protection 

Advisers brand family protection essential

Advisers brand family protection essential

Families could be at significant risk if they are not provided with proper income protection, advisers have warned.

Jeff Woods, business development director at Sesame Bankhall Group, said advisers could offer significant value to clients by discussing what sort of protection policies are available to breadwinners and those at home.

He said often income protection is provided in the workplace for individuals, but they have not been made aware of it.

Even then he said it is important for advisers when discussing houseperson's cover with clients.

According to Mr Woods, if one family member is working and the other is not, or has stopped work to look after young children, taking out houseperson's cover could help provide support for that individual should they become ill.

He explained: "Houseperson's benefit could provide an income of £1,000 a month to help cover the costs of running a home.

"In most instances, the main breadwinner has no option but to continue to work and this money could help pay for a housekeeper or childcare in the event the houseperson is too ill to undertake their usual daily activities."

Even if the houseperson has no cover, it is worth the main breadwinner having their own policy in place should the worst happen to their partner.

This happened to a client of Meena Ibrahim, independent protection adviser at Drewberry. She said: "Many of our clients are looking for peace of mind. 

"One of my clients, Paul Pantony, became a single father to his daughter, when his partner of 21 years passed away. 

"For him, income protection was important. The knowledge he has cover to help him and his daughter should he ever fall ill has been of enormous benefit to him, and lifted a real weight off his shoulders."

It is also less expensive than clients might think, as the Association of British Insurers' infographic shows, and can be exceptionally valuable in terms of helping to boost weekly income for the household.

ABI: Average premium and payout with and without IP

Their comments came as Johnny Timpson, protection specialist at Scottish Widows, said simpler life, income protection and critical illness products should be a priority to build on this year’s public engagement successes.

He commented that protection providers and advisers needed to scrutinise their practices in 2017 to remain relevant to an ageing population.

Find out more

Read FTAdviser's new Guide to Income Protection, which qualifies for 1 hour of structured CPD.

 

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