Information On Life Insurance

Premium protection is an addon to your life insurance plan, it goes by a number of different names with different insurance providers. Premium protection is a more modern way of saying waiver of premium on older traditional life insurance plans.

Premium protection is where you can cover your payments if you were to be off sick from work and were unable to pay your policy premiums. Normally this kicks in after 26 weeks and the plan will start to pay your premiums.

There are a number or different definitions that are applied to your payment protection or waiver of premium option on your life insurance plan. The main and best one is own occupation this would be defined you as unable to complete your occupation in the event of sickness or injury.

The next defintion is any occupation, this is where you were unable to do any job in the event of a accident or illness.

The poorest defintion is called activities of daily living, this is where your would be assessed if you could do 3 or more activities of daily living to justify a claim being paid out. These definitions could be getting from a bed to wheelchair, continence, dressing, mobility, feeding and washing.

So in answert to the original question, yes it was a good idea to add this to your policy, however it is important that you have a look at the small print and make sure you got the best definition for the premum protection. If you have own occupation there is a much higher chance of you getting paid out on this plan than that with activities of daily living.

If you have any liabilities then you should always consider taking out life insurance. Life insurance is there to give you some peace of mind should the worse happen. Specifically for your mortgage a specific form of life insurance can be taken out. This is sometimes referred to as decreasing life insurance. This works by the amount of cover decreasing over the years the policy runs. The cover that is decreasing goes in line with the amount that is owed on the mortgage. The plan can last from anywhere between 5 years and 40 years and can be taken up to your 70th birthday. You can take your mortgage life insurance in a joint format if you want to or on a standalone basis. The joint cover works on a joint life 1st death basis where the policy stops after the first death of one of the parties in the contract.

This is all good advice if you have a repayment mortgage however some of us have interest only mortgages, if this is the case then a level term policy is best. If the amount of the mortgage is staying constant then you need your insurance to remain constant and not reduce. This wouls mean the outstanding liability would always be covered.