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We didn’t review our policy and it was too late

When my wife Sheena and I got married 25 years ago, we decided to take out a joint life, first death policy. After spending so much money on our home, we wanted the cheapest option available to us.

Fast forward 25 years and so much in my life has changed. I still live in the family home, now with my two teenage sons and we have a dog, but Sheena sadly passed away earlier this year.

Now that Sheena has passed away, the one policy we had had paid out, so I no longer have a cover.

At the time of taking out the policy, we decided not to opt for RPI (Retail Price Index). I did not feel at the time, that our policy needed to be in line with inflation and after taking this option off, we forgot about it. As a result, the  cover we had in place, was only enough to clear the mortgage.

Having a background in finance, I should know all about the rising costs of living, but I did not link it to the sum assured. This turned out to be an unfortunate oversight on my part.

We didn’t review our policy and it was too late

I wish to leave some money for my sons to give them a good start in their lives. I’m in my 50’s; I have been diagnosed with cancer, I also have insulin-dependent type-2 diabetes, cholesterol and high blood pressure. All of which could mean that I might not get Critical Illness. I am also unsure if I will be eligible for life cover as I’ve not yet had the all-clear from the cancer diagnosis. If I do get cover, the price might be over my budget, and I may not be able to afford it.

When Sheena and I took out the policy, it suited us and our budget. We were young with no children, just a mortgage and we have never moved home, so we filed the policy documents away safely and left them in the cupboard. When we had our boys, we did not once think about life insurance.

I have now encouraged my children to ensure that they plan for the future and not make the same mistakes as us. I wish Sheena and I had thought this through, but we can’t change the past.

Please note: that the case study is based on a real-life scenario, but names have been changed due to client confidentiality.

Published Jan 2021.

It is important to take professional advice before making any decision relating to your personal finances. Information within this case study is based on our current understanding and can be subject to change without notice and the accuracy and completeness of the information cannot be guaranteed. It does not provide individual tailored advice and is for information purposes only.

Harish Hirani

Harish Hirani

With over 20 years of experience in financial services, Harish is a successful lending and insurance specialist. He commands a solid team of insurance advisors in mortgage lending, commercial lending, health insurance, life insurance etc catering to individuals, families, and business owners with several assets

Date: Jan 10 2021
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