Financial resilience is the ability to recover quickly from unexpected financial shocks. Many of us insure our homes and cars without really thinking about it, but far fewer insure their lives and incomes. And yet, if you were to die, how would those you leave behind be able to manage financially? If you were unable to work due to illness, how would you find the money to pay your household bills? Savings can and do help in the short term.
But what happens when they run out? What happens if an illness goes on for three, six, or even 12 months? What then? The ongoing Covid-19 pandemic has focused many people’s minds on the need for a rainy day fund and financial protection, particularly in the light of greater awareness of the meagre nature of State support.
In a recent survey of financial advisers, 75% reported an increase in willingness by clients to talk about financial protection. While nothing can ease the emotional distress the virus has caused and is continuing to cause, creating your own safety net can lessen its financial impact if you or your loved ones are directly affected by it. Life and health insurance protection underpins most good financial planning. These types of insurance can ensure that, should you or your family need it, the right amount of money will reach the right hands at the right time.
HOW WE CAN HELP
Insurers are constantly looking at new ways to meet people’s needs, such as through life insurance that includes critical illness and/or income protection insurance, which may be cheaper than taking out separate policies. It is important to look at your options – what do you need most now? How much cover do you need? Can you defer some cover until a future date? What can you do to protect yourself and your loved ones financially in light of the Covid-19 pandemic? Our role is to do four things:
● Know enough about you to make the right recommendations. We take the time to understand your financial situation, your needs, preferences and views. Whether for example, you would feel comfortable accepting that premiums may rise, or if you want a guaranteed solution.
● Help you to identify priorities. If you were insured against absolutely everything, like most people you may find premiums unaffordable. We don’t expect you to be an expert on life insurance, but we need to know your attitude to risk. Working out how things might change in the future and prioritising matters could be a sensible thing to do.
● Recommend solutions to meet your needs. The right policy is important, but a will or writing policies in trust could be too.
● Review. Your financial protection needs change over time. Regular reviews are essential to ensure your plans continue to meet your needs.
Read our guide below: