We all fall sick at times and for the majority of time it is just the odd day or two and then we are back on our feet again. However occasionally we suffer illness which requires a much longer recovery time and in some cases this could be several months. The majority of people can manage financially when faced with just a couple of days of lost income. Several months would be a totally different matter and you could be left with a financial struggle on your hands. Sickness insurance would go towards alleviating any worry of how you would continue meeting your payments each month.
The insurance works by the policyholder choosing the amount of their mortgage, loan repayments or income, up to the amount pre-agreed with the provider. The sum you chose to protect would be paid back to you if you suffered sickness that meant you were unable to work. However you would have to be incapacitated for the period set out by the provider. Some will allow you to make a claim after the 30th day and with others it could be up to the 90th day.
A policy can be taken out with a provider who specialises in payment protection products. This is usually one of the cheapest ways of securing your repayments against falling ill. You would have to make the choice of which type of sickness insurance to take out. You could choose to take out mortgage protection for repayment peace of mind of your monthly mortgage repayments. Protect loan repayments with loan protection and your essential repayments with income payment protection.
Taking out sickness insurance should be considered as without it you could have to struggle and make changes to your lifestyle in order to try and meet your outgoings. Protecting your home with mortgage cover against sickness would mean you would not be worrying about falling behind on your repayments. Recovery could be hindered by worry of mortgage arrears and for a small premium each month this can be averted. Being able to service the repayments of a loan would also cause concern. If you were to be unable to maintain the payments and fell behind you would have to repay the arrears of course and by then your credit file will have a bad mark against it. If this were to happen then any future borrowing would be next to impossible and it can take a lot longer to repair your rating than it did to destroy it. You would have peace of mind with income protection that there would be money towards maintaining any bills that came into the home regularly.
Sickness insurance provides great comfort at a time when you would need it the most. Taking the protection with a standalone provider offering payment protection often works out a lot cheaper than adding in cover at the time of borrowing. Great savings can be made this way and of course an independent provider who just sells payment protection will know their products back to front and pass valuable information onto you. Use this information to ensure suitability of protection insurance and you then have a security blanket to turn to if needed.
Jason Hulott is Editor of Protection Insurance, please drop by for protection insurance and Life Insurance. Visit http://www.protection-insurance.com
