MIp31_0210:MI 2008 21/01/2010 15:47 Page 5
Protection
31
Protect your clients
Despite all the bad publicity regarding PPI, it is important that your clients
know about the benefits of protecting themselves should something
happen to them
M
any of us have an idyllic picture of the State
looking after us should the worse
Statutory sick pay (weekly) £75.40 Incapacity Benefit (weekly)
happen but the reality is far from rosy.
Looking at the following information is
Child Benefit Long term incapacity benefit £84.50
sobering – could your clients afford to live on benefits
Short-term incapacity benefit (under state
if they were unable to work, lost their jobs or became
Who the allowance is for Weekly pension age)
ill? (And don't forget about your needs as well!)
amount Lower rate £63.75
A recent survey by the Association of British
Eldest or only child £18.80 Higher rate £75.40
Insurers (ABI) found that:
Additional children - per child Short-term incapacity benefit (over state
l61 per cent of respondents thought they would fare
£12.55 pension age)
quite badly or very badly if they were to lose their
Guardian's Allowance - per child Lower rate £81.10
job tomorrow. Only 3 per cent thought they would
£13.45 Higher rate £84.50
cope very well.
lWhen asked if unable to work for an extended peri-
Attendance Allowance Income support (weekly)
od of time, which of the following would be relied
upon to cover living expenses, the most common
Attendance Allowance (AA) is a weekly Jobseeker's Allowance
were: reduce expenditure on non-essentials (49 per
benefit paid to help people for the extra Those aged 16-17
cent), state benefits (44 per cent) and spend existing
costs associated with having a disability or £47.95
savings (43 per cent).
long-term health condition which could Those aged 18-24 £47.95
lWhere respondents were asked about protection
result in care needs. It is not means tested Those aged 25 and over £60.50
products they hold, 50 per cent said life insurance
and is tax-free. It will not reduce any other Couple both aged 18 or over £94.95
but 39 per cent said none of the following: Life, PPI,
income your client receives. In fact, if you Dependent children £52.59
MPPI, IP, CI. 69 per cent of respondents said they
are awarded AA you may become entitled
would not be willing to take out any of these prod-
to other benefits, such as Pension Credit Maternity allowance (weekly)
ucts in the future.
or Council Tax Benefit, or an increase in
lWith the cost of living rising, respondents were
those benefits. Standard rate £117.18
asked how they would expect to make ends meet in
Paternity allowance
the coming months – 62 per cent said they would
Lower rate: £44.85 £117.18
reduce expenditure on non-essential items and 18
Higher rate: £67.00
per cent said they would spend existing savings. 22
Pension credit (weekly)
per cent of respondents said it wouldn’t be a prob-
lem (i.e. their income would fully absorb the rise in
Disability Living Allowance (weekly) Those claiming this must be 60 or older
cost of living).
with £12,000 or less (£16,000 for those in
lIn terms of the areas where respondents were will-
This is benefit for those needing residential care)
ing to cut back their expenditure, eating out / pub
assistance with care and mobility. Single person £124.05
(74 per cent), cinema / theatre / books etc (63 per
Couple £189.35
cent), clothing (63 per cent) and holidays (59 per
Care Component
cent) all featured highly. Insurance products (7 per
Highest £67.00 State pension (weekly)
cent) and pensions (6 per cent) less so, while 25 per
Middle £44.85
cent of respondents said they would reduce the
Lowest £17.75 Based on own NI contributions
amount they contribute towards their savings and /
£90.70
or investments (other than pensions) and 19 per
Mobility Component Based on spouse's
cent would stop contributing completely.
Higher £46.75 NI contributions alone £54.35
The following information gives a guide to how
Lower £17.75 Pension for those 80-plus £54.35
much help people are actually entitled to from the
Additional increment for age £0.25
state. The numbers almost sell protection products for
you!
www.mortgageintroducer.com February 2010 Mortgage Introducer
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