Funeral Plans

A funeral pre-payment plan is a simple way of paying for your funeral in advance and enabling you to plan every aspect to ensure that your wishes are recorded in detail and passed on to your family at the time of need. The funeral pre-payment plan can be paid for in one single lump sum or by monthly instalments and your family are guaranteed not to have to pay a penny more.

Can I Personalise a Funeral Plan?

A funeral plan can be arranged and personalised just the way you would want it; your favourite flowers or music, a particular church or location, all of these things can be listed down so that your final wishes can be met. The added comfort is in knowing that you will have left details on the funeral you wanted and should make the emotional and financial burden a little easier for your family at an already difficult time.

Funeral Insurance

There are a number of different funeral plans available on the insurance market that are designed to cover the funeral costs in the event of your death. These funeral plans guarantee to cover the cost of the funeral director, a contribution to cremation or burial costs and various other associated costs. The funeral plans come in various price packages to suit all budgets and requirements and once the funeral plan has been paid for, the money you have paid is ‘ring fenced,’ (which means the money cannot be spent on anything else), guaranteeing your funeral costs are covered for future eventualities.

The Financial Conduct Authority does not regulate funeral planning.

Whole of life plans

Whole of life cover plans are designed to pay out in the event of your death. The premiums are due every month and are normally fixed during the term of the plan.  There is the potential with whole of life plans that you could pay more money into the plan than possibly may pay out.

If you decide to choose a whole of life plan you will be given an option of with profits whole of life, non-profits whole of life plans and low cost whole of life plans.  Speak to your Proadvice adviser to find out which plan is suitable for you.

We are unable to provide you with advice on investment based whole of life plans, however we can introduce you to a specialist.

Over 50’s plans

The over 50’s plans are life insurance policies designed for people over the age of 50 only. These plans are sometimes taken out on the grounds that it is a ‘no questions asked’ policy and you are guaranteed to be accepted, irrespective of your medical history or whether you may have been declined by an insurance provider elsewhere for your cover. On this basis, there is a significant increase in the policy premiums you will pay when taking out an over 50’s policy.

Please find some information on some other Financial Products that you might find interesting.

What is an Endowment Life Cover?

An endowment life insurance plan is designed to pay a lump sum on death or when the insurance plan reaches maturity. If you are still paying premiums, bonuses are added to the policy, usually annually and are normally guaranteed. Each year you will be sent a statement which will update you on how your policy is performing. The endowment element can act as a savings plan as well as covering you for your life assurance. Endowment policies have increased in popularity in recent years and there are a number of reasons that people may take them out, such as having a specific savings goal or as a general investment. At one time, these policies were even used as a payment method to cover an interest only mortgage, (these endowments were a common way of saving to pay off the interest only mortgage), however this is no longer the case. The aim was to provide the buyers a way of paying their mortgage off if one of them were to die or a way to provide a lump sum to clear the mortgage at the end of the plan. By paying interest only on the mortgage meant that the repayment method was cheaper.

The endowment plans are linked to the Stock Exchange and many people were promised that there would be enough not only to clear their mortgage but also to provide a little extra bonus on top. Many people were reliant on the endowments to clear their mortgage but the policies were actually never guaranteed to cover or repay the full amount.

Being linked to the Stock Exchange means that the potential pay-outs can go up but there is also the risk of them falling too. If you had a good financial adviser they would have you completely updated and informed of the plans targets and predicted shortfalls and looked to move your plan or advised you of other potential options available such as surrendering your policy or dependent on your endowment plan, you could possibly have sold it on. 

Millions of people were given the option to make a complaint if they felt they were mis-sold an endowment plan due to the shortfall. The endowment plans paid large commission to financial advisers and were sold on the promise of big returns and ended up with people being left massively out of pocket. To be able to claim compensation on the basis of being mis-sold an endowment policy, it has to be proven that you were incorrectly advised and that the plan under performed. 

Currently endowment policies are hard to find and have become very expensive. It is often advised to take out a separate saving plan and a separate protection plan, rather than an all in one plan. It is advisable not put all of your eggs in one basket!

We are unable to provide you with advice on endownment plans, however we can introduce you to a specialist.

Critical illness insurance

Critical illness insurance is a long term insurance policy designed to pay out a lump sum or income on the diagnosis of certain life threatening or debilitating (but not fatal) conditions, such as a heart attack, stroke, certain types/stages of cancer, multiple sclerosis and loss of limbs.

Once a successful claim has been paid by the insurer, it is at your discretion to use your money as you see fit. This could be used to pay off your mortgage, cover your bills while you are off work, protect your family or pay to have private treatment. The money is yours and it is completely up to you what you decide to spend it on. In some cases the money could be used to change your home to suit your new circumstances if needed, such as adding a wheelchair ramp. The choice is down to you and your own personal circumstances. 

It is usually cheaper to take out life and critical illness cover than critical illness on its own. Critical illness cover is more expensive than life cover on its own as you are up to seven times more likely to claim on a critical illness policy. The good news is that a critical illness policy does not cost seven times the amount but still works out more cost effective to take out a life and critical illness policy.

 

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