Why you should always be covered amid a cost-of-living crisis

Protection insurance is severely undervalued by thousands of people across the UK. Often  seen as an unnecessary expense – there are a vast number of people living in this country  who are yet to take out a protection plan and therefore remain unprepared should they lose  their income or worse – their life. With a cost-of-living crisis currently causing panic for many,  it’s so important to stay covered even when you’re looking to cut costs elsewhere. Despite  common misconceptions surrounding how often providers pay out, tougher times make  protecting your family should anything happen to you even more vital 

The necessity of protecting  your income in particular has  never been more apparent.  The pandemic offered millions  of people a scary insight into  just how quickly circumstances  can change for anyone by  forcing a huge proportion of  the population out of work.  Now, imagine how dire that  would have been without the  safety net that the furlough  scheme provided for so many  households nationwide. Illness  can stop you working at any  time and without warning and  being in the midst of a cost-ofliving crisis, protecting yourself  against such an outcome has  never been more valuable.  Well, that is the harsh reality that faces those who are yet  to take out a protection policy.  Despite the evidence, there are  still some common myths that  dissuade people from turning to  protection.  

Do providers actually pay out?  So, do providers actually pay  out – or is it all too good to be  true? Well, contrary to what  some sceptics might say, 98.3%  of all claims made in 2019  on protection policies were  accepted. This figure is enough  on its own to display just how  common a successful claim is –  and how unlikely it is that a claim  is rejected. There are of course  a few occasions when providers  don’t pay out – most commonly due to underlying issues not  being disclosed when the policy  is initially taken out.  

Can everyone get cover?  Another common  misconception surrounding  the protection industry is that  more complicated cases get  turned down. There are plenty  of insurance providers that  specialise in the more complex  of cases – and the figures  suggest that the vast majority  of those cases pay out too. The  Exeter reported that 93% of  claims were paid in 2021 with a  total pay-out of over £10 million.  Out of the 1,318 claims made  throughout 2021, only 92 were  turned down.  

It’s so important for everyone  to protect their income, and if  the past couple of years have  taught us anything, it is that no  one can predict what the future  holds. Being protected against  any eventuality is a safety net that  could prove to be invaluable to  any of us. 

 If you’d like to discuss the options available to you, contact an adviser today

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