What is their average monthly
expenditure, including any annually
or periodically paid costs?
What about any outstanding
debts and loan repayments?
Do they have money set aside
for unexpected expenses?
How would their
ability to repay
be affected by
a loss of income?
Your client should include both
individual and joint debts.
They should consider secured
loans such as car finance,
mortgage repayments and
household goods as well
as unsecured loans.
Family members may become
liable to repay outstanding debts.
What would
happen if they
suddenly lost
their job?
Your client should think about
what lifestyle adjustments would
be required, e.g. entertainment
and leisure costs.
Would they still be able to pay
school and further education fees?
What further impact would there
be on any dependants they may
have, for example caring for
elderly parents?
What employee benefits would
be lost? For example; company
car, or private health insurance.
60% of middle income working
households would see their
income fall by one third if the
main earner was unable to
work. 40% would see it fall by
more than half.
Do they have
a backup plan
in case of
redundancy?
BBetween October and
December of 2017, 107,000
people were made redundant.
What savings does your client
have, and how long would
these last in covering household
expenses?
Could they access funds from
any investments?
Would family members be able
to provide support until your
client found another job?
Voluntary redundancies are usually
not covered by unemployment
insurance policies, and most won’t
start until 3 months after job loss.
Some insurers will also protect
the value of employment
benefits, such as a company car
or private health insurance.
Does your client rely
on a job for their
monthly income?
One million workers a year
suddenly find themselves unable
to work due to a serious illness
or injury. Around 250,000 each
year leave employment
completely due to ill health.
Is your client self-employed?
How would their business
fare in their absence?
Women account for half the
UK workforce, but over 50%
have not taken out individual
protection.
What other income sources
do they have, if any?
Do they need to be fit and healthy
in order to keep benefitting from
these other income sources?
Does their
employer provide
support for
short-term illness?
Employers are required to pay
Statutory Sick Pay, but only for
up to 28 weeks. It’s worth
around £89.35 per week.
Only 43% of employers offer
sick pay provision over and
above the statutory requirement.
Your client can claim Statutory
Sick Pay if they’re employed
but unable to work and if
their earnings have accrued
above £113 a week for at
least two months.
How would
your client’s
finances be
affected by
critical illness?
50% of those diagnosed with
cancer in England and Wales
live for more than ten years
afterward.
If an employee is unable to
return to work after 28 weeks,
they can apply for Employment
and Support Allowance (ESA),
which is around £70 per week
for the first 13 weeks.
Only 33% of ESA claims are
accepted.
Critical illness policies generally
pay out once and conclude
immediately afterward.
What provisions
have been made
in the event of
their death?
Whole-of-life vs. term-life
insurance policies – the former
guarantees a payout, but
premiums are more expensive.
If a joint life policy is
appropriate, would it pay out
on the first or second death?
Do they have mortgage
protection to ensure that family
members don’t lose their home?
Some life insurance policies
also pay out upon terminal
illness diagnosis.
Exclusions can apply to life
policies, e.g. death due to
drug or alcohol abuse, or
existing illnesses.
If seriously ill, how
would your client
support themselves
long-term?
According to Cancer Research
UK, 50% of people born after
1960 will be diagnosed with cancer
at some point in their lives.
Nearly 990 new cases of cancer
are diagnosed everyday.
How would your client meet
mortgage obligations if they
became critically ill?
Would they be able to continue
paying car finance or other
secured loans?
Could savings and investments
such as savings accounts, ISAs,
and any stocks, shares or bonds
be relied upon for the rest of
their life?
Does your client’s
employer offer a
‘death in service’
package?
Death in service packages
normally pay between 2 and 5
times an employee’s current salary.
Some packages can be linked
to an employee’s pension
scheme, so employees may only
receive a payout if they are
signed up to the workplace
pension scheme.
A payout cannot be assigned to
a mortgage, but could be used
to help with monthly payments.
98% of protection insurance claims presented in 2017 were paid out upon claiming2.
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UK insures pay out £9.9m every day for protection policies.
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£89.35 statutory sick pay is only £89.35 per week for a period of up to 28 weeks.
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£68,000 the average value of critical illness claims paid in 2016 was £68,000.
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40% Inheritance Tax (IHT) is applied on assets worth over £325,000
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8.9 of every 1,000 opposite-sex marriages end in divorce
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£33,904 is the annual cost of residential care in the UK, this can rise for more complex needs
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£63,224 is the average cost of raising a child between 1 and 4 (discounting private education)
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£40,000 Those who receive financial advice accrue an average of £40,000 more than their counterparts
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£231,843 According to research, raising a child costs an average of £231,843
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£6,000 2017 studies show that retirement income is more than £6,000 per year higher for those who plan ahead with an adviser
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137m working days were lost due to sickness or injury in the UK during 2016
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50% of UK citizens born after 1960 will be diagnosed with a form of cancer at some point in their lifetime according to Cancer Research UK
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