Ways of protecting the family’s income

Although it is tempting to think that “it won’t happen to me,” in reality, few people get through their working life without being made redundant, having an accident or becoming seriously ill. Having suitable insurance in place gives you the peace of mind that you and your family won’t suffer financially if the worst does happen – and it may cost less than you think.

Here are three of the most common ways of protecting the family’s finances:

Life insurance: pays out an agreed sum if you die. You may already have life insurance, either as part of your employee benefits package or as a condition of your mortgage. If you do, you should make sure that the amount it would pay out is enough for your family’s needs.

Income protection: pays a regular amount if you are unable to work due to an illness or accident. You may already have it as part of your employee benefits package but you should make sure that it would provide you with enough replacement income.

Critical illness cover: pays a lump sum if you are diagnosed with certain serious illnesses. You may already have critical illness cover as part of your employee benefits package but you should make sure that it covers a wide range of conditions.

No single solution
Most people find that they need more than one sort of insurance to give their family the cover they need. It is worthwhile consulting a professional financial adviser to make sure you are fully covered.