Accident sickness insurance is a name for a set of policies that can be taken out to protect you against the possibility that you could suffer from an illness or an accident and be unable to work. It would provide for you financially when it came to paying out a variety of essential outgoings. You can take out different policies to suit your needs and then just pay a small premium each month for the protection.
The amount that you would have to pay for the protection would depend on how much you insured for, your age and in the case of mortgage protection the level of cover. With mortgage payment protection you are able to insure against accident and sickness only, incapacity only or for accident, sickness and unemployment together.
One of the best ways of protecting your finances all-round is with income payment protection insurance. The policy would provide with up to so much of your income depending on the amount you insured against when taking out the policy. This money would be tax-free and you can then use it pay for all of your essential outgoings which could include your mortgage and loan repayments. Of course you would also have the money needed to be able to meet all of your outgoings each month that you had to pay.
Another form of accident sickness insurance is mortgage payment protection. This is taken out solely to safeguard your mortgage repayments each month. You cover your mortgage repayment up to a certain amount and then get this sum back and continue to meet your mortgage repayments. This means that you are not at risk of losing your home to repossession by the lender.
If you have loan or credit card repayments to make each month then consider taking out loan payment protection. Loan protection would cover just the repayments of any borrowings you had made either on credit cards or taken out as a loan which you repaid monthly. You would not fall behind in debt and would not have threats by the lender to take you to court.
All forms of accident sickness insurance are cheaper when taken with a standalone provider. Loan and mortgage payment protection are offered when taking out the loan or mortgage with the lender. However this is the dearest option for covering yourself with protection. In some cases you can save as much as 80% on the cost of loan insurance and 40% on mortgage protection. If you take out age based policies then this means the younger you are the bigger savings you can make. Payment protection policies usually payout somewhere between the 30th and 90th day of incapacity or of unemployment if this is included in your cover. They then usually continue paying for between 12 months and 12 months before expiring. You do have to check the terms and conditions of the policy before taking it out as each provider can offer different conditions. The exclusions in a policy will also vary and it is these that have to be checked against your circumstances if you are to have the peace of mind that a policy should bring.
Simon Burgess is Managing Director of the award-winning British Insurance, a specialist provider of accident sickness insurance. |
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