Accident Sickness Insurance Saves Financial Difficulty

By Simon Lance Burgess

Finding yourself with a loss of income would come as a huge blow. Yet each year millions of individuals face sickness or suffer an accident that means they are unable to earn their own income. Some of these also face unemployment through no fault of their own and lose their income. The majority have loans, mortgages and other outgoings each month that have to be kept up with and of course a loss of income puts a great strain on them. Accident sickness insurance can save a great deal of financial difficulty and it does not have to cost a lot.

There are three types of accident sickness insurance you are able to take out depending on your needs. Mortgage payment protection would provide you with an income so that you would be able to keep up with your biggest outgoing, your mortgage. You would not have to worry about falling into arrears and of the lender taking you to court if you cannot catch up on them.

Loan payment protection insurance would also provide you with an income except this time it would cover any loan or credit card repayments that you have to make each month. This would help to keep your credit rating in good stead because you would be able to keep up with the monthly repayments. It is essential to keep your credit rating unaffected because this is what all lenders look at before deciding whether to give you a loan. Of course there are more consequences to suffer by missing loan repayments. If the loan is secured then your home is at risk. The lender could also take you to court and you could find yourself with a Count Court Judgement.

If you want to protect all of your outgoings then income payment protection insurance could be more suitable. This would allow you to insure up to so much of your own income each month and then you would be able to continue to meet all of your outgoings. This would include your mortgage, loan, credit card and all other monthly bills that you would need to pay to keep out of financial difficulties.

Accident sickness insurance can be taken with the lender when you take on the borrowing. Usually this will be the dearest option for taking out insurance. Lenders have been known to add on the cover for the entire loan and then add interest in on top of this. In some cases this has boosted the loan up by almost half again and what was once a cheap and affordable loan isn't any longer. A cheaper way is to take your cover with a standalone provider.

All accident sickness insurance policies would have a deferment period. This is the time you must wait before claiming, some providers state 30 days and with others it can run up to the 90th day. Once the cover has begun to provide you with your income it would continue to do so for between 12 monthly payments and 24 monthly payments, dependent on the terms set out by the provider. The cost of premiums will be based on your age, the amount you wish to insure each month and with mortgage cover the level of protection you want. You can choose to take accident and sickness only, unemployment only or cover all three.

Simon Burgess is Managing Director of the award-winning British Insurance, a specialist provider of accident sickness insurance.