You may have read about this in the press, but as the date approaches we still don’t know exactly what the overall effect of this will be, but it looks likely that the costs for a wide variety of insurance products could increase towards the end of this year as a result of a ruling from the European Court of Justice (ECJ).

Women look likely to be the most effected from the equalisation of insurance premiums. Men tend to die younger than women and therefore typically cost more to insure. Whilst the rates for men and women may meet somewhere in the middle, it is more likely that rates for women will just increase.

However on the subject of annuity purchase, women reaching retirement are likely to be offered higher annuity rates to bring them in line with men.

Contracts already in force will not be affected, so it might make sense for those of you who need insurance or are considering purchasing an annuity to consider reviewing this sooner rather than later.

Please bear in mind that underwriting can sometimes take longer if a GP report or medical is required. So far no insurer has really declared its hand, so it is very hard to say one way or another, but if you are likely to be in the market for either then it would be worth a conversation.

Are you adequately protected?…
Apparantly most of you aren’t!!!….

Aviva have recently released their ’2011 Family Finances Report’, and one aspect caused me particular concern and therefore I felt compelled to highlight it.

They say that of the 2000 people surveyed 95% said they didn’t feel they were completely protected, and 49% feel unprotected or completely unprotected, and even the 22% that felt they had some security only feel ‘protected if nothing unexpected happens’….. Seriously?!?!?! Surely the purpose of protection is to protect against the unexpected! That last statement spelt out the gravity of the problem in my opinion!
In light of the fact that I read an article in the press suggesting that the price of term assurance premiums had fallen by approximately 50% over the last decade, I am surprised that so many people are under insured, or even not insured at all!

On a completely separate note, and nothing to do with the Aviva Report, another interesting statistic I read in the press was that as a general rule, employers in the UK were more likely to insure their photocopier than they were their own staff!

I cannot tell you how strongly I feel that protection, or the lack thereof is something that needs to be addressed and quickly! The impact of not being protected can be absolutely catastrophic, and if people think the recession was difficult, I cant imagine what adverse effect the death of a primary breadwinner would have for example! Sorry to be so morbid but I would rather people felt a reaction to this article and do something about it than tread around on eggshells and people not do anything.

If you feel you are one of those that isn’t adequately protected, whether life, critical, mortgage, income protection or key person, or just want a review of your protection arrangements, then please email us or give us a call. We can look at a whole range of protection solutions for clients, and it really doesn’t have to cost the earth!

Attention Company Directors…
ensuring your life protection is tax efficient….

Protection is a massive part of the whole advice process, and whilst it can be a very morbid subject, trust me when I say the implications of NOT discussing it should the worst happen are far, far worse!! However, every now and then something comes along which can make the prospect of discussing and subsequently paying for this type of cover easier to bear.

When we talk to clients about protection it isnt always driven by what level of cover, or type of cover a client SHOULD have, and the reason for this is simple, in most cases we have to consider the clients budget and affordability! so when opportunities arise that can reduce the cost of cover we cant ignore it.

For example, there is currently a way that assuming a number of criteria are met, we can make the premiums payable for basic life cover that much more affordable and tax efficient.

This is aimed more at business owners that are looking for the most tax efficient way to provide family protection, and can in some cases reduce the total cost of cover by almost 50%. It can also help businesses with too few employees for a group death in service scheme.

So if you own your own business, or know someone that does that may well benefit from discussing this in more depth, then please dont hesitate to get in contact.

1 in 3 people in the UK will be diagnosed with a Critical Illness…this was the headline in an article I read recently, and it sent a shiver down my spine.

It is vital that when we select a Critical Illness provider for our client, we not only choose a company that provides good value for money, but we also choose one with a good claims performance and one that takes a human approach to some of the less straightforward claims.

I have been in the unfortunate position this year of having to process a number of critical illness claims for our clients, and whilst it isnt a pleasant experience, it is one made far more tolerable for the client knowing that they are covered and will be receiving a lump sum of money to be able to either take time out of work without worrying about money, modify their home, or repay some / all of their mortgage.

Not everyone has attractive sickness benefits at work, and in fact a good deal of employees in this country have very little over and above basic SSP, and then of course, there is always the self employed!!!

Key statistics:

• 1 in 3 people will be diagnosed with a critical illness between the ages of 40 and 70
• Breast cancer is the most common cancer in the UK
• Prostate cancer is the most common cancer diagnosed in men in the UK
• Every year, around 150,000 people in the UK have a stroke. That’s one person every five minutes.

I have heard many comments over the years from clients worried about insurance companies and whether in the event of a claim they would actually get paid, Well, in my opinion times have changed, and with tight ABI definitions, and thorough underwriting, the situation is far clearer.

Here are some statistics published on IFAOnline in recent months:

• Last year Aviva paid out almost 95% of critical illness claims totalling over £136m and 99.6% of those resulting from death totalling over £272m. Non disclosure accounted for only 1.6% of total claims declined, and 3.7% for not meeting ther conditions.
• Last year Zurich paid out 91% of claims totalling over £60m, with only 1% of claims declined for non-disclosure of facts. Cancer typically accounts for almost 50% of claims, followed by heart attacks (12%), strokes (7% and MS (3%)
• Scottish Widows have paid out over 90% of CI claims in 2010, and have paid out over £1bn in claims since 2000, and the average age of a claimant was on 55 years of age!
• Scottish Provident has paid out over 90% of all the CI claims in 2010 totalling over £88m with Cancer accounting for 63% of toal claims made.

As Independent Financial Advisers, we can give advice and make recommendations on this and many other aspects of your protection arrangements, from simple life cover and mortgage protection, through to income protection and key person / shareholder protection for business.

Please contact me if this is something you would like to discuss in more depth.

Shane Beardsley
Managing Director / Independent Financial Adviser

tel: 01482 658989
email: shane@kirkellainvestments.co.uk
web: www.kirkellainvestments.co.uk

e.g. Private aviation, Scuba Diving etc

The last couple of weeks have seen me quoting an above average number of Life Protection and Business Protection terms for individuals that participate in hazardous pastimes including flying helicopters and scuba diving.

Contrary to popular belief amongst participants in these activities, there can actually a very real risk of injury with some activities, and many participants have previously struggled to obtain life cover and critical illness cover because of this. In fact some clients have simply not bothered trying because they did not believe they would be able to obtain cover full stop.

Well, this simply isnt the case! there are obviously cost implications for certain hazardous pastimes, but by asking the correct questions and getting the correct underwriting assistance there is still a very competitive market within certain mainstream life insurance companies.

The benefit of our being independent means that we are able to approach the medical underwriters of all the life insurance companies to secure fair rates! Different companies treat hazardous activity loadings in differing degrees and sometimes it means researching several companies before submitting applications, or even submitting multiple applications, and sometimes avoiding what may appear at first glance to be the best value.

Allow us to do the leg work for you! so if you or any of your contacts have had problems in the past, or simply havent tried, then please pass on my details and I will see what I can do.

Shane Beardsley

I read an interesting article recently about the improvements to certain providers critical illness definitions, and it started me thinking about critical illnesses in general, I mean, if someone is diagnosed with one of the many terrible illnesses listed on all the documents that arrive in my offices each day it must feel absolutely awful, and I cant belittle it in anyway, but if you actually analyse them, there are many of those illnesses that whilst they will probably render you unable to work, at least for a while, and in some cases render you unable to work again, how many of them will actually kill you? the answer is not many! for example loss of sight or hearing, loss of limbs, third degree burns to mention a few.

Someone once said to me that getting a critical illness was actually worse than dying! I cant say I necessarily agree with that statement, but, how long would an employer actually pay your wages for if you were taken ill with a serious critical illness? and if you have a mortgage protection plan that only pays on your death, but you dont die; what will you do when your savings run out? and with a massive proportion of the country having less than 500 GBP in savings the outlook can be quite bleak.

So for the sake of what can often be a small monthly outlay, why burden yourself and your family with that worry?

If you feel that you would like to review this, please contact us on 01482 658989, or email me on shane@kirkellainvestments.co.uk and I will arrange for an adviser to contact you.

Shane Beardsley
Managing Director / Independent Financial Adviser