In our new video series, the ABCs, we are going to talk to you about some case study clients. Starting with A, we are going to bring you videos that represent special risk conditions, and run all the way through the alphabet.
The case study clients discussed in these videos have had their details changed, to protect their anonymity.
In this first video, I talk to you about Mrs A, a former alcoholic. Having previously been alcohol dependent, Mrs A came to us with the concern of protecting her mortgage liability. Watch the video to find out what we were able to arrange for her.
Hi, and welcome to the CuraVision ABC series. Now this set of videos, what we're going to do is literally go down the alphabet looking at different medical conditions and how we've been able to help clients arrange protection insurance with these specialized conditions. I have, of course, changed the details enough to protect our clients' anonymity.
So our first case today is Mrs. A. For ease of sake, I'll probably refer to her as Angela as I'm discussing her situation. Angela came to us with a need for protection because she had a mortgage, a capital and repayment mortgage, and also some young children. She wanted to make sure that if something was to happen to her, especially while that mortgage is in place, that there would be some financial security in the family. Angela was 45 years old, a non-smoker. And that's something that insurers like is if you're a non-smoker. Her BMI was slightly above the normal range, but nothing that would cause a concern to the insurers for the life insurance.
We had spoken to Angela. We established that about a decade ago, she had a period of alcohol dependency. Over multiple occasions, she had been admitted to alcohol dependency detox units. But she had been teetotal and free of medication for around 10 years, so it was something that was very much in her past. She now had a mortgage. She had a family. She was full-time employed. So something that really didn't have any kind of baring to her health as it is today.
What we did is we went to multiple insurers, and we spoke to them. We figured out which one was going to be the best one for her based upon her circumstances. I am pleased to say that we found an insurer who was quite happy to cover her for the life insurance at what's known as standard rates. That means that it was no premium increase, no exclusions, nothing other than the bog standard normal policy, regardless of that medical history, because they agreed with us that her health and the alcohol dependency had been obviously quite a long time ago and her health now was absolutely fine. If the alcohol dependency had been quite recent, then it would have been slightly different. She would have probably had a premium increase. I would have had to have looked at specialized policies with specialist insurers who could have covered her for those initial stages, maybe the first few years, after the alcohol dependency had stopped until we were a bit further down the line.
What we were able to do for Angela was arrange a decreasing life insurance policy that covered her capital and repayment mortgage. Decreasing life insurance is designed to essentially mirror a capital and repayment mortgage in the amount of liability and value. We also arranged some level life insurance to go alongside that up to the age of retirement. With her having young children, if something were to happen to her before retirement age, it covers a certain number of years' salary just to bring that into the household. I had to make sure that the children, obviously, had everything that they needed and the funds there for them for their upbringing. That was placed into trust for the children so that is was nice and secure for them if the worst should happen.
What we did also do, as well, is we did identify a need for critical illness cover and income protection for Angela. But she felt that, at the time right now, her priority was the life insurance, and that would be the biggest impact to her family if she was to die unexpectedly. Of course, as advisors, we feel that she had that need for, potentially, the critical illness cover and income protection. However, that wasn't her priority. So she decided not to go ahead with that, which is of course absolutely fine, because at the end of the day, when you take out these insurances, you need to make sure that you are comfortable with what you're taking and that it's something that you feel that you are happy to a pay a monthly premium into over a certain amount of time.
In Angela's case, we were able to, throughthe decreasing life and the level life policy, we were arranged for her roughly £155,000 worth of cover for 22 years for a monthly premium of approximately £19 per month. That gave her that piece of security, peace of mind, in a sense. That's if to say, should the worst happen, her family would be financially secure.
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