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Does your client think Income Protection is too expensive? Maybe they’d rather spend their hard-earned money on something else – like TV packages or phone insurance. But what if you could offer comprehensive protection for less than £10 a month? Here’s how.
Sam is 30 – he doesn’t smoke and works as an account manager. He earns £27,000 a year and plans to retire at 68 (state pension age). His £43.90 starting quote is based on:
As with many clients, £43.90 is too expensive for Sam – his budget is £10 a month. Here’s how you can tailor cover to meet Sam’s needs and budget.
|Option||Feature and justification||New premium|
|1||Reduce the cover amount to match the £1,000 monthly mortgage payment. Sam’s partner works full time and contributes to the household income – her income will cover the other bills during a claim.||£34.64|
|2||Reduce the term to 25 years to match the mortgage.||£31.43|
|3||Increase the waiting period to three months as Sam has enough savings to cover this period.||£27.56|
|4||Change the cover to Budget Income Protection (which pays out for up to 12 or 24 months).||£16.67 (24 months budget option). £14.65 (12 months budget option).|
|5||Use a combination of the above to bring the premium down further: change the cover to the 12 months budget option (guaranteed premiums only), reduce the cover amount to £1,000 and increase the waiting period to three months||£7.55|