6 types of basic protection every family should consider

From critical care to cover for calamitous accidents

Ioana

by Iona Bain | Independent Money Mentor

Founder of the Young Money Blog and author of Spare Change


You’ve wrapped them in cotton wool, placed them inside a protective bubble and kept stabilisers on their bikes for as long as you could – yes, you take keeping your family protected very seriously. Beyond insisting they wear a crash helmet and body armour at all times however, there are more useful ways to give them protection and you peace of mind.

Protection 1: Critical Illness

Critical Illness (CI) insurance will provide you and your family with a lump sum payment in the event of serious illnesses such as heart attacks or stroke, and even long-term conditions like cancers and Parkinson’s disease. Any sick pay offered by your employer and state benefits could well be insufficient to cover your financial commitments if you are off work for some time, meaning a large sum of money would be very helpful to keep up large expenses like mortgage repayments. Be aware that illnesses such as early stage cancer are not always covered by CI insurance so you should check what is covered before taking a policy.


Protection 2: Income Protection

Income Protection (IP) will provide a substitute income if you can no longer work due to an accident or illness. IP usually covers more common health issues such as muscular-skeletal conditions and mental health problems like depression. Speaking to a broker will help you find the policy which is right for you.


Protection 3: Life Insurance

Life insurance ensures your family are financially supported in the event of your death. Depending on the policy, you can arrange for them to receive either a lump sum or regular payments. A whole life policy will pay out irrespective of what age you die, while a term life insurance policy, which could last any number of years, typically up to 40, will only pay out during the term of the policy. Certain professions and contracts include a “death in service policy” as part of your employee benefits package which could provide alternative cover. Check to see if you are eligible as this amounts to a built-in life insurance policy as long as you remain with your employer.


Protection 4: Caring for your home

From the careless DIY enthusiast on a wobbly ladder to the energetic shower dancer we all know accidents can happen at home. Home insurance should foot the bill for fire, theft and much more besides. Building insurance covers you in the event of structural damage like subsidence while contents insurance applies to your possessions. Check the small print to understand what you are actually covered for, in the event you need to make a claim. Accidental damage to a property is not normally covered under a standard policy. You’ll probably need to buy extra cover for this.

If you plan to be away from your property for long periods, check whether your insurer has any restrictions. They may not accept a claim if you have been absent for more than 30 consecutive days. Invest in some heavy-duty locks and you may well deter potential thieves as well as lower your premiums.


Protection 5: Travel

Regardless of how you like to spend your holiday time - from lying inert on a sun lounger to slaloming down ski slopes – accidents can happen. Should the unthinkable happen on your dream trip, you’ll be glad of travel insurance. Should you need to cut short or cancel your trip due to illness or injury, need medical treatment overseas, have travel plans disrupted or lose your passport or belongings, insurance may help cover of the costs. Study the terms and conditions of your policy to make sure it covers all areas of concern.

While travel insurance is frequently offered as an extra service with bank accounts and credit cards it may not always cover everything you need – especially when it comes to pre-existing medical conditions – so it pays to shop around and check you’ve got the cover you need.


Protection 6: Internet safety

The internet is a big, bizarre and not entirely safe place, especially for younger users. While we all love a good cat video, protecting your loved ones from the darker corners of the web, pornography and cyberbullying is a daunting task. Take simple steps such as installing parental controls on your home broadband and children’s mobile phones as well as download safe search engines like swiggle.org.uk or kids-search.com. Establish internet and phone-free time, such as at the dinner table to limit the time your child spends online. It is also essential to teach the basics of online safety, such as not divulging personal information and never arranging to meet online strangers.

So, there you have it – six steps to more security and protection for you and your family. And not an elbow pad or safety harness in sight.

Before making financial decisions always do research, or talk to a financial adviser. Views are those of our mentors and customers and do not constitute financial advice.