Moneywise offers a comprehensive service
in relation to life assurance protection contracts. With
a vast array
of products and types of protection available it can
be confusing to determine which type of protection is best
suited to one’s needs. Moneywise acts as a guide
providing independent advice and sources the best rates
available on the market.
Permanent Health Insurance (PHI)
Otherwise known as Income Protection. PHI covers the policy
holder unable to work long term due to due to an illness
or an injury.
PHI provides a monthly taxable income payable after a
deferred period, usually 13 or 26 weeks (the period during
which an employer may continue to pay a sick employee).
The benefit paid cannot be more than 75% of your net earnings
including any state benefit paid to you while out of work.
The maximum age to which you may have the cover in place
is 65.
Every income earner should have some form of PHI cover.
The state benefit is minimal should you fall ill or seriously
injure yourself in an accident and is certainly it is not
enough to maintain a reasonably normal lifestyle. However,
those particularly at risk are the self-employed and shareholding
directors as they are not covered by PRSI for illness or
disability benefit.
Life Cover
Life cover comes in many different forms all aiming to
achieve a similar goal in different ways; that is to protect
your dependants in the event of your death. The required
level of cover depends on each individual’s circumstances.
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Term Assurance: This
is a standard life cover policy covering the life of
the policy holder(s) for a specified term.
There are several versions of this such as level, where
the premium and cover remains level throughout; indexed
where the premium and the cover rises by say, 5% to
keep in line with inflation; convertible allows you to
convert
the policy at the end of the term at prevailing rates,
without the need for further medical underwriting.
Serious Illness
Here a tax free lump-sum is paid to you on the diagnosis
of one of a specified list of critical illnesses such as
heart attack, stroke or cancer. It is different to cover
such as health insurance in that it is aimed at serious
conditions only that may have a major effect on your family
finances. The lump sum paid is to replace any shortfalls
in income or increased expenditure due to illness.
Partnership Insurance/ Keyman Cover
Keyman Cover is life cover taken out by a company to cover
the life of a key member of staff, without whom the company
would struggle. A person upon whom the company relies heavily
for the income stream and the day-to-day running of the
company. Here the company pays for and is the benefactor
of the policy.
Partnership cover is different from Keyman in that each
partner in a business takes out life cover on each other’s
life. The proceeds of the policy should one of the partners
die is used to buy out the shareholding of the deceased’s
spouse.
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