IFA Compare Admin
Payment Protection Insurance has been the subject of vast amounts of media speculation in recent months.
Banks have been widely criticised for miss-selling this Insurance and as a result are now having to withstand the financial burden of having to compensate thousands of customers.
It comes as no surprise given the recent media coverage that many people now often shun the purchase of this type of Insurance in the belief that Payment Protection Insurance is a complete waste of time.
There is no doubt that in some cases the purchase of Payment Protection Insurance is unnecessary. Some people have perfectly adequate financial alternatives that could be depended upon to replace income from employment. However, this is not always the case and in the correct circumstances this type of Insurance can be a very effective financial remedy.
If you feel unsure about whether Payment Protection Insurance would be a waste of your money, then you may wish to give serious thought about how you would cope financially if you found yourself unemployed or unable to work due to an accident or sickness. If you would find yourself unable to financially cope in these circumstances, then it may be time to consider investigating this type of Insurance.
When investigating Payment Protection Insurances there are a few basic facts you need to understand and questions you should consider asking the Insurance provider to make sure the policy will meet your needs:
What does the policy cover?
Generally, this type of policy would pay out a monthly sum in the event that you become unable to work due to accident, sickness or unemployment through no fault of your own.
When comparing policies you may wish to find out the exclusions of each policy. Some policies will cover you for pre-existing medical conditions, but not all
How quickly will the policy pay out?
The length of time it takes for a Payment Protection Insurance policy to pay out is known as the deferment period. Different policies have different deferment periods, usually ranging from two weeks up to 6 months.
The longer the deferment period, the longer you would have to support yourself financially without income before your Payment Protection insurance would start to pay out
When comparing policies give some consideration to the deferment period each policy would carry
How long would the policy pay out for?
This type of policy often pays out for up to 12 months.
As with any financial product do your research, compare your options and make sure you understand what you’re purchasing before you make a commitment.
If you feel you need some advice about this type of Insurance, consult an Independent Financial Adviser
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