PERSONAL PROTECTION INSURANCES & TRUST STRUCTURE

Insurance is a subject many like to avoid because it requires confronting scenarios that are clearly unpleasant. The reality is that traumatic events do occur.  Just imagine how much easier those difficult months and years would be, if you were to receive a tax-free lump sum payment or ongoing regular income.  Insurance premiums become increasingly more expensive as you get older (even if you remain healthy), so it is often advisable to take it policies as early as you can and to lock-in to a guaranteed premium.  A change in mortgage is an ideal time to review your insurance position and Carbon strongly suggest you check your position.

Why do I need life insurance?

  • To protect family by replacing a lost earner
  • To leave an inheritance or a mortgage free home
  • To cover debts and estate taxes
  • It is usually relatively inexpensive and through the use of a simple Trust Structure, the pay-out is fast and tax free

Why do I need Critical Illness Cover?

  • Most clients we speak to are woefully underinsured in this area, but it is arguably the most important of the three policies given the likelihood of a claim. It is almost certain that you will know someone who has had a critical illness that would have qualified for an insurance payout.
  • To cover living expenses if you don’t have substantial savings
  • To pay for home modifications needed for a disability

Why do I need Income Protection?

  • To replace income if you are unable to earn due to sickness or injury
  • Because employer and government cover is usually inadequate

Clients can feel confused over the different types of policy, provider variations, cover exclusions, pricing spread and policy add-ons.  At Carbon we advise on the most appropriate policies with the most relevant providers ensuring their personal objectives are met.  For example, many of the cheaper internet sourced policies are littered with small print and it can be difficult to ascertain what exactly you’re paying for.  Often these policies aren’t what you would have hoped for and may result in a lack of cover.

Insurance package example for a 30 year old healthy male, taking out a 40 year policy with no health concerns:

  • Life insurance of £300,000
  • Critical Illness Cover of £75,000
  • Income Protection of £1500pcm
  • Additional options:  guaranteed premium, waiver of premium, terminal illness cover, accidental death, fracture cover, global treatment, own occupation and RPI indexation = £145pcm


Payment Protection Insurance is optional. There are other providers of Payment Protection Insurance and other products designed to protect you against loss of income.