Life Insurance – What on earth are they on about?
I don’t know if you do the same as me, sometimes I can be having a conversation with someone and they will say a word. I have no idea what this word means, but I nod along and make a mental note to check later.
Occasionally I’ll stop them and admit I don’t understand, it depends who it is. Sometimes I’ll nod along and say ‘oh yes…’ then realise by the look on their face, that is the wrong response and subtly alter it to a shake instead. Why do I do this? Easy, I worry that I’m going to look stupid, that I should know what that word means, or know more about Brexit, or Economics or Politics.
When I did my training and qualification for providing advice on Protection Insurance, at times I really did sit there and think, there’s too much to learn here, I’ll never get it all. But I did and was fascinated by how it all worked and the history behind the concept.
I had Protection Insurance before myself, I understood basically what it was but really had no idea why it had been set up like it was, I just trusted the advice I’d been given and went with it. TRUST – there’s a word, that’s the key, you want quick professional advice from someone likeable, knowledgeable and trust that they are going to do a good job. That’s what I got, years ago, but I never asked the questions, I should have, I should have said so why this way, why is that best for me? What does that mean? I just simply trusted that the job had been done correctly and why shouldn’t it, they are the professional right?
Now I’m on the other side of the fence, I love a question, I am so passionate about making sure clients understand why they need their Protection Insurance setting up the way it is, how it would work in which circumstances. But also, aware that sometimes potential clients feel a little overwhelmed by all the jargon. Forgive me if you are reading this and you are always the one to ask questions, you understand everything about Brexit etc. Good on you, I wish I could be like you but I’m not!
One thing I do know inside out now though, is Protection Insurance, it is always changing, the basics stay the same, but the number of new products appearing each year and new and better ways of providing more affordable insurance is mind blowing, and extremely exciting.
The way that some of the providers are encouraging their clients to be healthier, not just by exercising, but aiming to look after their mental health too is a win/win, you are healthier, you get rewards. Others offer counselling, physio and many other benefits for just being a client, you don’t even have to have made a claim!
So, let’s bust a few myths to finish off –
You sign up and you are stuck in a contract, yes?
NO! You can cancel your Premiums at any time by letting the provider know, or simply by stopping the direct debit. HOWEVER, if you do this you will no longer be covered, that’s it covers over. You will with some providers get the opportunity to restart the cover if you catch up with your payment and under the same policy, so it just restarts, there’s no application process. If you are switching providers, DO NOT CANCEL any existing policies until you are accepted for your new cover.
You must change your Life Insurance every 2-4 years, yes?
NO! Now this one makes my blood boil, yes of course if your broker is worth their salt, they will be in contact to make sure your circumstances haven’t changed and that you are still adequately covered. If you are, fine, leave it as it is. It does need reviewing, but it does not need changing every 2 or even 4 years. Each time you have a birthday, your cover gets more expensive, you are more of a ‘risk’ the older you get, you will have more things wrong with you, so if you keep redoing your Life Insurance every 2-4 years it will just get more and more expensive. If you have good and appropriate cover, leave it as it is.
If you do need a higher level of Life insurance, sometimes it is cheaper to look at taking out an additional policy rather than altering an existing one, but again a good insurance advisor will do this for you and give you this advice. It’s always worth occasionally having a look round to see if you can get the same level of cover cheaper, but make sure you are covered for at least the same amount of conditions if not more…
It’s more expensive to use an advisor, yes?
NO! The amount you pay premium wise is the same. We get paid direct from the provider, that’s it. I don’t even want to elaborate too much on this point. We are the experts, let us sort it out for you then like I’ve said before, you will have an appropriate level of cover, you will know what you are covered for and the whole process will be done for you, plus you will then have a point of contact in the future should you need to alter any details or make a claim. Just go with your gut on this one, read all the blog guides I’ve done and make sure you feel the job is being done right and for the right reasons. If you aren’t sure take a look at their reviews, chat to other clients if you can, you’ll get a better picture.
PS Us Insurance advisors are all on the same team, I want you to make sure you have adequate cover at the end of the day, there are brilliant advisors out there, if anyone starts bad mouthing someone else doing the same thing, I always think that says more about them than anything else…
So, in summary, if you don’t understand something you advisor is telling you, ask, they will be more than happy to explain. I’m going to try and apply this in all other parts of my life, especially when someone is giving me directions… come on you know you’ve done that.