1. Have a budget

It doesn’t matter what that budget is.

There is no point in putting a protection plan in place if 6 months down the line you have a tough few months, cashflow is tight and you go “right, let’s cancel the insurance policies, we have to make savings” That means all those premiums you’ve paid up until then (assuming nothing bad has happened of course) are wasted.

Decide on what is an ongoing affordable budget for business or personal protection. Something you know you can afford even if you go through a lean patch. That way you are more likely to come up with a realistic figure.

It sounds crazy right? You might say “tell me how much X, Y & Z will cost and then I’ll tell you if I can afford it” But the only way to get a true, realistic budget is if you think of the number first. I have clients that spend £100 a month and others that spend £1,000. Most don’t start at the top, it’s a matter of prioritising needs, taking care of the top one or two, depending on budget, and then reviewing it annually.

2. Will it pay out?

The industry has been battered by the bad press from PPI and you always hear stories about when insurance didn’t pay out. The reality is, if you look at the stats published by the Association of British Insurers the opposite is in fact true.

Why is it you don’t hear the stories from the 97.2% that did pay out? No-one like good news maybe? Bad news travels fast? If you are honest about the information you give, you pay the premiums and your adviser does their job properly, you should be dropping into that 97.2% group. If you advise yourself and go online….good luck! But there’s no comeback if you get it wrong as opposed to indemnified advice.

3. Something is better than nothing

In an ideal world you’d have everything right?

But here’s the thing, we don’t live in an ideal world and when a lot of people are offered ideal world solutions to protection that advises they have everything, they look at it and go “How much?!!”, decide it’s too expensive and take nothing, feeling like they’ve had a lucky escape from something they knew they couldn’t really afford.

It’s ok, get the top priority covered, have something in place, it IS better than nothing!

At the very least make sure your family will be able to pay the rent/mortgage and feed themselves if you aren’t there to do it for them. Everyone’s top priority isn’t the same and most people don’t know what is available, how it works and how it could be relevant to them.

The only way to get the answer is talk it through with someone who does know.

4. It’s so complicated!!

Well, it is, kind of. But so are cars, computers and cross-stitch, unless you know about them and if you don’t you go to an expert. Someone who knows the complicated bits, the detail, the mechanics, the processing, the paperwork, the underwriting, the trusts and can explain them to you in a way that you will understand and that you understand the reasoning behind the advice you’ve been given and the how the products work.

5. How will I get through the process?

A good adviser will hand-hold you through the whole process. Provide you with all the paperwork, and in the case of application forms and trust documents, annotated versions with boxes marking out exactly which sections to fill in and additional notes if necessary. Make it as simple as possible for the client. Take the complication out of the process and take on the responsibility of getting all the paperwork right.

6. Put it in trust!!!

There are only two reasons not to put a policy in trust.

(i) If it’s Key Person life of another (i.e. the company taking out cover on an employee with the proceeds going to the company or Loan Protection designed to pay directly to someone else

(ii) You want the funds to go into your estate, create potential inheritance tax liabilities and take up to 18 months or so to get to where you want them to, if at all. The average time of probate in the UK is 8-12 weeks if no inheritance tax is payable and 14-16 weeks if there is.

The reality is the last time I dealt with probate it took 18 months and that was with everything in place. If you have a policy in trust you give the policy number, a certified copy of the death certificate and the trust document to the provider and it takes an average of 12 working days.

When families have bills to pay, funeral costs to cover, and they are grieving, the last thing you want to do (because it probably is the last thing you will do) is put them under more stress and hardship trying to get the money you left them to avoid exactly that!

7. Wills… Make a will!

A surviving partner who wasn’t married or in a civil partnership with the deceased has no automatic right to inherit. If you want to know what happens, according to the law. Run through the scenarios here https://www.gov.uk/inherits- someone-dies-without-will

It’s about control, making sure what you want to happen, happens.

Pure and simple.

Make a will.

📩 Want specialist business protection advice? Get in touch with Martin directly:

📧 martin@businessprotect.biz | ☎️ 0161 956 2470