The Life Insurance Market
When she first contacted us, the client was under-insured through her bank with an expensive Life Insurance policy, plus an Accident, Sickness Unemployment) ASU policy.
We replaced her life plan with a Fortis policy for £250,000 over 31 years, which would cover her mortgage payments. We also wrote this policy into trust. The client's previous policy had not been written into trust and there was a potential IHT liability.
Next we turned to Income Protection (IP) and Critical Illness (CIC) to replace ASU. IP (index-linked) was a priority for the client as she earns a large salary. We chose to put her with LV= as we knew they would only rate the client 50% for her high blood pressure, a better underwriting stance than any other provider.
However, the policy was also chosen because at that time LV= was offering free CIC with each IP policy sold. The CIC payout would be 3x the monthly IP sum assured of £1500. The client was very specific that she had a limited budget, which meant a choice between IP and CIC. In addition, all LifeSearch policies come with free access to Red Arc, the care and counselling service.
The client was diagnosed with cancer 5 months later and LV= successfully paid out on their free CIC policy. The CIC payout was £4,500, whereas previously she would have received nothing. She has now been off work for several months and will soon begin to claim on her IP policy too.
The client also claimed on her Red Arc policy, which is an ancillary benefit. The counselling nurse has helped her emotionally and also suggested new medications to try to help her through her illness.
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