Insurance

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James Hammond

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Price comparison websites have become popular with millions of people frequently using them to hunt out deals.

But in searching for best value insurance quotes, many of us may inadvertently leave a footprint on our credit scores. And we all know how important it is to keep on top of that.

When consumers use comparison sites to source insurance quotes, it can trigger some insurers to access credit data to assess someone’s suitability for a premium installment payment plan (spreading payments for an annual premium over one year). Credit searches also help the insurer give customers more accurate quotes.

However, the impact on your credit score depends on the type of search that is carried out on your file. Look out for a ‘credit search’, as opposed to an ‘enquiry’, on your credit report. This indicates an application for credit and affects your credit rating directly. Plus, all credit searches will be seen by potential lenders, possibly impacting your future chances of securing a credit card, loan, mortgage or service.

Since many insurance providers carry out checks with credit reference and fraud prevention agencies, it’s important that consumers understand that in using comparison websites, they may secure a great value product in the short term, but their longer term credit rating could be severely dented.

To protect your credit rating, be wary when searching for insurance quotes on comparison sites. And although it’s a risk, it’s also worth noting that credit checks do not happen unless the consumer accepts the terms and conditions. So always read the T&Cs and/ or the website’s privacy policy.

If you’re concerned about the impact of using comparison websites on your credit rating and you want to find out more, just give me a call.

 

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James Hammond

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Back in January, I appeared in an FT Advisor article about the lack income protection with a quote:

“It’s true that confidence is low regarding protection. A minimum level of protection would be useful and a drive by insurers to dispel some myths regarding what they will pay out on would also improve confidence in protection products.”

Six months later, the situation is much the same. Mortgage Strategy recently published an article which says that nearly 60% of mortgaged homes do not have any protection insurance whatsoever.

The article goes on to note that even those which have some protection are mostly only covered for death or critical illness. Income protection (in case of the loss of a job) is even scarcer.

It is a good time to consider your mortgage, your savings, and your insurance. If you need help, give us a call. We are independent financial advisers – we are here to help you find the best protection for the biggest investment you’re likely to make.

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James Hammond

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With all the excitement around growth and changes in the mortgage market, perhaps the the protection market has slipped under the radar. In a lot of ways, the two markets go hand in hand and changes to the way people buy property certainly affect the way insurance is bought and sold.

That is not to say that they are simply two sides of the same coin, though. While the lenders are improving their product ranges, insurers are at the point of completely rethinking the way they offer protection thanks to evolving technology.

One particular change we expect is that policies will be increasingly tailored to the individuals who take them out. An article from Money Marketing focuses on wearable technology and health, but that is just the tip of the iceberg.

The insurance industry has a lot to work with, and to work through. Trials of new technology will fuel important discussions on ethics and practicalities. So, watch this space!

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Daniel Jarvis

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Our James appeared in the FT Adviser last week to discuss mortgage protection.

Mortgages are complex products, and they come with a big risk to people who find themselves unable to pay. One way to help with that risk has been to purchase protection plans.

However, the public has been unhappy with protection plans, recently. In part, this is because other sectors have come under a lot of scrutiny for mis-selling protection plans.

But, as James said:

“It’s true that confidence is low regarding protection. A minimum level of protection would be useful and a drive by insurers to dispel some myths regarding what they will pay out on would also improve confidence in protection products.”

As with any product, customers need to know as much as they can about what they are buying. This is doubly true for investments which come with risks.

If you’re not sure where you are with mortgage protection, drop us a line. We are not pressure-sales people, our advice is unbiased and we can help with all aspects of your mortgage.

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James Hammond

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LV= has dramatically improved its critical illness cover, paying out twice the original sum for certain illnesses.

The double cover is the headline enhancement in a raft of changes to its policies. Overall, LV= is now offering:

  • 200% cover for specified conditions (for example loss of speech, paralysis of a limb, traumatic head injury) caused directly by an accident
  • 150% cover for customers under 45 diagnosed with certain neurological diseases
  • Cover now available for 11 more conditions, including nine new partial payment conditions
  • Definitions for motor neurone disease and terminal illness
  • Maximum age for cover increased from 60 to 65
  • Children covered for the same number of illnesses as adults

There is a cap of an additional £200,000 on the double payment feature. The new full payment conditions are cardiac arrest and pneumonectomy, while the partial payments are:

  • Accident hospitalisation
  • Arteriovenous malformation of the brain
  • Carcinoma in situ cervix
  • Carcinoma in situ urinary bladder
  • Minor stroke
  • Minor heart attack
  • Non-severe cardiomyopathy
  • Partial third degree burns
  • Testicular carcinoma

It is nice to hear positive news in relation to life insurance companies. LV=’s hybrid approach between traditional cover and severity-based payments throws down the gauntlet to other insurers.

Just remember that Limetree are whole of market insurance brokers. When it comes to finding the best critical illness cover for you we will research not just Liverpool Victoria, but the rest of the market too.

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