BENEFITS FROM YOUR BREAKDOWN COVER
Did you know your car breakdown policy may come with a large number of perks? The AA, for instance, offers 25 per cent off an English Heritage membership, a ten per cent discount at Halfords and free eye tests at Vision Express with discounts on prescription glasses as well as a free three-month supply of disposable contact lenses.
During the pandemic, most car breakdown providers will assist customers that work for the NHS even if their policy wouldn’t usually cover them.
And some providers, such as Green Flag, will attend to the car of any NHS worker for free, including non-members.
NOT everyone buys protection insurance, and you might not feel you need cover. It is particularly useful for families with large outgoings such as a mortgage, school fees or living costs, where there would be a struggle to continue to pay if one breadwinner was unable to work. But as young families get older and become less dependent, protection needs can be reassessed.
You can buy cover online, directly from banks and insurance firms, while comparison sites such as GoCompare, MoneySupermarket and ComparetheMarket all offer ways to weigh up different products. Or look at Lifesearch, a protection-specific site.
If you want to go it alone, take care filling in the forms and reading the small print. Insurers require you to disclose all pre-existing conditions for life insurance, as well as asking for family medical information.
You will need to work out how much cover you might need, which involves taking into account any debts you might have, family commitments and any existing cover you already have, for example death-in-service benefit through an employer.
If you are feeling less sure, a specialist financial adviser can help you to choose the most appropriate protection products for you. While advisers must
charge their customers for selling investments and pensions, they can be paid a commission for selling protection products, so it is important to check you are getting independent advice on what is right for you.
The cost of protection policies varies hugely, depending on age, weight, family history and habits. For example, a 40-year-old female non-smoker could get £100,000 of level term life cover for £8.57 a month for 25 years with no critical illness cover.
A 50-year-old male smoker with no other pre-existing issues could get £100,000 of level term life cover and £25,000 of critical illness cover for just over £79 a month for 20 years, while a 40-year-old male non-smoker could get ten years of family income benefit of £100,000 for £5.49 a month. A 73year-old non-smoking male paying
£25 a month into an over-50s plan could ensure his relatives receive a £3,125 lump sum on death, if he dies at least a year after starting the plan.
To determine if you need protection, consider your current financial situation and savings and imagine what you’d do if you were unable to work, or what your family might do if you couldn’t provide for them.
If your family set-up is complex, you may also need to consider what might happen to a separated parent of a child. ‘If you split up and you have children, you need to make sure your ex has cover,’ says Sarah Coles of Hargreaves Lansdown. ‘If your partner is paying maintenance, you need that to be covered if they pass away.’
Sites such as unbiased.com and vouchedfor.co.uk contain lists of vetted financial advisers.