With interest rates and the cost of living continuing to rise, many people are looking at ways to save money. However, one outgoing that you should avoid cutting back on is insurance.

Life cover

Life cover is essential if you have a mortgage and dependents. Ask yourself what would happen if you were to die; how would they pay the mortgage and keep a roof over their heads? Life cover pays out a lump sump on the death of the policyholder, designed primarily to pay off the mortgage and protect dependents. Monthly premiums are relatively cheap, particularly if you are young, don’t smoke and are in good health.

Critical illness cover

Avoiding financial stress is something we would all welcome. So once you have life cover in place. You may wish to consider a policy that pays out a lump sum. These may include cancer, cardiac arrest or kidney failure. Critical illness cover gives you a lump sum that can be used to cover childcare and household bills if you have to take time off work while you are ill and during your recovery.

Income protection

For a longer-term insurance policy, unlike critical illness which pays out a one-off lump sum, you might wish to consider income protection. This is for those who are worried about losing their job because of illness or an accident; the state provides very little in the way of financial support if this happens so income protection pays out a regular income until retirement or your return to work.

Private healthcare

NHS resources are usually overloaded, which is exacerbated by the pandemic. So those requiring medical assistance may have to wait months for a doctor’s appointment or referral, with operations routinely postponed.

This is where private healthcare comes in. Many employers offer this benefit as an incentive to employees to ensure that the family members and you members are protected should you ever need to seek medical attention. Some employers don’t offer health insurance plans that are private.

Insurance for contractors and the self-employed

While those who work for an employer will often get insurance cover as a benefit-in-kind as part of their remuneration package. This is not the case for day-rate contractors or the self-employed. If you are in this position, it is worth taking advice from a whole-of-market broker such as AWS Private Finance. We have seen a significant increase in enquiries about private healthcare and other insurance since the pandemic; schemes vary depending on what policy you need and can afford.

For example, if you are a director of a limited company. It may be possible to take out cover as a director and there are tax-efficient ways of protecting yourself and your family. Get in touch for more information.