I hear you ask, what is family income benefit insurance? Let me lay it out simply for you here as it’s something all families should have. Getting a family income benefit policy in place should be looked at by your family today. First off, family income benefit insurance is a type of life insurance. It’s set up to run for a set time known as the term, this is usually until the children of the family become financially independent.
"We weren’t even sure what insurance was best to get when we came to True Advice. They really made an effort to keep everything simple and make sure our family was covered correctly which was great."
"I’ll be honest, I wasn’t even sure what family income benefit was. Ashley explained it so simply though and once I heard about it, I knew it would be a great fit for our young family. The peace of mind it brings is really fantastic."
If an insured party passes away within that term it pays out a regular tax free income until that term comes to an end. This can be crucial for families when looking at budgets if a loved one was lost. You have life insurance that covers a lump sum on death or critical illness. But what about after? What does the family do going forward to cover food bills, electricity and so on? This is where family income benefit steps in.
How much do you get insured for? For how long? What will be covered and who will be insured? These are all complex questions and can be hard to work out. This is where our FREE advice on insurance comes in handy. Just in case you didn’t get that, yes, it’s FREE. We take no fee off of you to carry out the insurance from advice through to application. How we begin this process is with a full fact find on your financial and personal situation. This helps us look at the gaps in your financial circumstance that could be short falls if not insured. Then we take this information and research the right insurance products for you. If you have a family, we will definitely recommend family income benefit insurance. The whole of market of insurers will be assessed for the best deals out there and a recommendation will be presented for you to look at. As described earlier, family income benefit provides a tax free sum to keep the family in the home. This can be key if you are made a single parent and are struggling to pay for the normal family expenses. Even if you don’t have a mortgage, this can be key to keep a family going until the children are independent.
Not typically, no. This type of insurance is meant to cover ongoing living costs for a family rather than a sum to pay off a mortgage in the event of demise of a spouse. To cover a mortgage you would be looking at a lump sum payment such as life insurance cover. The life insurance would look to pay off the mortgage sum in full. Then the family income benefit would kick in after that to support the income that is missing from the deceased. With the mortgage paid off with life insurance you will have a lot less expense in the household. But with food bills, electricity, council tax, water costs just to say the least, running a household isn’t cheap. When you don’t have the time you once had with a partner to take care of the kids, you can really feel the pinch. This insurance provides you with that money that your partner would and gives you the time to give your family the attention it needs. At the end of the day that is all insurance is, a cover to take away the worry of financial burden. When you are grieving and missing a loved one, money is the last thing you want to think about.
Again, no. For this, you would be looking at income protection insurance. This insurance protects you when you are off for a period and don’t have cover. Employed persons will have typically have sick pay in place, but you won’t if you are self employed. This is another avenue we can look at for you. It is also worth consider key persons insurance cover if you are a business owner. This is a way you can insert life insurance into your business expenses. For business owners it should be looked at, head over to our page there to learn more. Whilst you’re there, let’s get you a great deal on your buildings and contents as well. It doesn’t hurt to review insurance periodically. We want to look after you fully and make sure you have the best deals going forward.
Cost will be based off a number of factors. The insurer will look at the term that you need for the insurance. Typically this is done from the youngest child’s age until they turn 21. Children in the eyes of insurers become ‘financially independent’ at the age of 21. Although we know that isn’t always true! So generally the term is to do the youngest child’s age until 21. If your youngest was 5 then this would be a 16 year term. Along with this the insurer will also look at how much you want to get covered. You may not even know how much you need monthly and I don’t blame you, it’s a hard amount to put your finger on. This is where our fact find process really helps. During the process it asks you to compile a budget planner. This budget planner goes over your households expenses and tally’s them all up. It takes into account all the households bills in all the sections you can think of. Electricity, water, council tax, clothing, food, toiletries, child care, land line, phone bills, car insurance, you name it. You tally all of these costs up and this is your total amount that you need insured monthly. It would be clever to also think about what costs you wouldn’t need if you only had one partner. For example, you are not going to have as much food or insurance costs. But overall, it’s best to over insure and be comfortable than be struggling.
So now you have your term and your amount what sort of price can you expect? This all varies and we will only know when we have your full fact find to ask the insurers. They will also look at what work you do whether it’s high risk. Such as being a fireman or a police officer. Whether either of you smoke or have smoked in the past. They take a look at all of these factors and provide a quoted price. The process is free and we guide you from step one to the finish. So all there’s left to do is… Get in touch with us today to discuss your family’s insurance needs. It’s FREE, did I mention that? Please do be advised as well that we also cover the full remit of financial advice including pensions, investments & mortgages.
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