What is happening in the life insurance and income protection market? Questions for Trinity's Danny Davis
1) Has there been an increase in life insurance applications since the pandemic hit?
Demand for life insurance has hit an all-time high since the start of the pandemic with more people seeking financial protection advice than ever. The rise in mortgage transactions due in part to the stamp duty holiday has increased demand and people want to know how to protect their families if something happens to them.
2) What types of policies are your clients taking?
Life insurance and income protection plans are popular. For many the reality of not receiving an income is really starting to become more imaginable and as a result income protection is a much easier solution to communicate.
3) Is it possible to get life insurance if you have had coronavirus?
Insurers normally accept life insurance applications from people who have tested positive for coronavirus at least four weeks after having had the virus. This is providing they do not have the unfortunate longer-lasting medical complications associated with long covid.
5) Would some clients rather take the risk and not be insured?
More people understand that not securing sufficient cover for their mortgage is a huge risk which they are not willing to take.
6) What is the minimum cover a family should have?
It is important to look at the insurable need, particularly liabilities such as a mortgage, rent and child costs. I recommend a life insurance policy for most families large enough to clear the mortgage and a separate policy to financially support the children until they reach financial independence (commonly age 21).
7) Why would first-time buyers with no dependants take life insurance?
Not having life insurance to cover the mortgage can cause serious financial issues in the event of death, and when people die, the mortgage still needs to be repaid. Life insurance offers a simple solution to what can be a complex problem, and it takes the pressure of family members.
8) How long does it take to set up life insurance?
If you are instantly accepted for an application which tends to be the case 80% of the time, it is an immediate process. If your application requires some form of medical evidence like a health MOT or further information from your GP, it could take two to three months.
We have a great support team that manages the progression of life insurance applications to ensure they are approved as efficiently as possible.
9) Does everyone need to have a medical?
No, not everyone needs a medical screening as a form of medical evidence. This is normally a required approximately 10% of the time. However, I view a medical as much more of a positive compared to a negative. It is ultimately a free health MOT.
10) Do life insurance premiums increase the older you get?
The cost of insurance is tailored to your age and health when you take out a plan, and it is normally guaranteed for the duration of the policy. The thing with life insurance that most people do not realise is that it gets more expensive with age, so the earlier you take the policy, the cheaper it will be.
We can tailor a ‘protection’ package to any insurance budget, but as a rule, the more you spend, the more comprehensive the pay-out.
11) Does unemployment cover still apply?
The providers pulled their unemployment cover policies at the start of the pandemic, and they have not been reintroduced. This is a shame because lots of our clients are keen to take these products.
Contact Trinity's will writing and protection specialist Danny Davis on 020 7016 0799 or book a consultation by emailing him.
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