Buy Term And Invest The Difference
Buy Term And Invest The Difference - Does It Really Work?
In recent months there has been a backlash against Income Protection
Insurance in the UK. When it emerged that banks were selling people
policies they didn't need or understand, hundreds of angry customers
demanded compensation, and both the banks that sold the products and the
products themselves became discredited in the eyes of many consumers.
However, it is wrong to assume that because it was mis-sold by some
unscrupulous lenders, income protection itself is unnecessary and
untrustworthy. A great many families have benefited over the years from
the safety and security provided by policies that protected their
finances at a cost that was compatible with their income.
Recent figures suggest that income protection is more needed than ever,
with the problems facing the economy increasingly acute, and no signs of
things picking up any time soon. People who are reluctant to give
themselves some kind of financial safety net could find themselves in a
dire situation if they lose their job or become unable to work for some
reason. Accidents, sickness or unemployment can happen to anyone, and yet
people now seem unwilling to prepare for such eventualities.
It is estimated that over 50% of the UK working population have less than
£1000 with which to fall back on if they were to lose their jobs. The
average working Briton has just £2,205 sitting in the bank, equal to just
1.7 times the average monthly take-home pay. The implications of this are
dramatic. Breadwinners who become unemployed without sufficient savings
to cover their expenditures will find themselves plunged into a spiral of
debt and financial problems from which they will struggle to recover.
Incredibly, the number of people who have income protection now is
smaller than at the start of the recession. So, can people overcome their
recently acquired distrust and be convinced to start buying unemployment
insurance once again?
It may depend largely upon consumer awareness. Since being stung with
expensive lawsuits, the big banks have begun to steer away from offering
these products, and consequently the market has become more balanced and
fair, but also less prominent. Consumers often aren't aware these kinds
of products are available, and are even less aware of where they can get
a good deal.
The FSA (Financial Services Authority) have taken steps to ensure the
insurance industry provides only fair and transparent income protection
services, meaning that if customers are not treated fairly, the insurers
will face very hefty fines and penalties. It is certainly one of the most
well regulated products on the market, and if this fact was more widely
known it would go a long way to assuaging peoples' fears.
If you are still unsure of whether income protection is right for you,
seek out some impartial advice on the subject. There are still a wide
range of suppliers with great deals to be had out there, and the
continuing economic slump means that the need for this kind of service is
now greater than ever before.
iprotect Insurance is a leading provider of income protection insurance.
Visit iprotect for more information on income protection in the event of