14 August 2019

Consumer Question

4 min read


I’ve just had my third child and have been advised to put some insurance in place, but after making some enquiries, I’m pretty confused and have a limited budget. What’s the difference between Life, Serious illness and Permanent Health insurance?


Commenting on the above question, Sara Murphy, marketing lead at Royal London, said:

“Yes, insurance is an important consideration, especially when you have people that will be financially dependent on you. Understanding the benefits of each of these types of insurance can be confusing; we recommend using a Financial Broker to help navigate the options available. As a guide, Life Cover pays out a lump sum in the event of your death.

“There are generally two types; one that lasts for a specific number of years called Term Assurance and a Whole of Life alternative. Term Assurance is usually more affordable. Serious illness cover pays out a lump sum if you are diagnosed with a specified serious illness during a determined number of years. The list of defined illnesses can vary from company to company but generally all of the major illnesses like cancer, multiple sclerosis and stroke are covered. It can be taken out on its own or alongside Life Cover. Permanent Health insurance is more commonly called Income Protection and it effectively replaces some of your income (up to a max. 75%) if you are unable to work for an extended period of time due to an accident or illness. This type of policy provides you with a regular income, starting after a deferred period (from four to 52 weeks) with the potential to continue until you retire depending on your health. Affordability is obviously an important factor and your age, current health and the amount of money you want to be insured for all impact the cost but prices can start at €15.15 per month.

“This is a simplified guide and the cover offered by each company will vary, so getting independent advice from a Financial Broker before choosing a policy is recommended.”

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