Legal & General is urging families to protect their mortgage and their lifestyle with the appropriate insurance as the difficulties in the financial markets really begin to bite.
Bonnie Burns, Product Marketing Director of Protection says: "Anyone with a mortgage is likely to be worrying about how much their payments might rise if they have to remortgage this year. This is set against a backdrop of higher council tax, higher food and petrol bills and slow wage increases. The question on many people's lips could therefore be ‘can I afford protection?' but the question should be ‘can I afford not to have it'! Most families' finances would unravel if a parent died or became too ill to work. They are risking their futures by not protecting their key asset - their future income. It is just as important to cover your bills as it is to cover your mortgage payments. Bringing up children is expensive and any parent has felt the impact of reduced household income due to a Mum or Dad taking a career break to look after their kids. Imagine if either that main or secondary income were to disappear permanently due to the parent passing away. That could be a financial disaster."
Family protection policies are available to provide a monthly income for a set term, should the policyholder die or suffer a critical illness. This is over and above traditional life insurance, typically taken out to cover a mortgage. It is relatively inexpensive compared to the risk of not being able to afford to pay their bills.
Legal & General's Family Personal Income Plan would cost a 35 year old woman £9.87 a month (assuming she was a non-smoker and in good health) for a monthly benefit of £1000.
Life insurance: News update: June 2008