5 points to consider when taking out cover

When taking out risk cover it is important to understand the cover you have, what it will pay for and what it won’t pay for. If you understand your needs and the cover you have selected, it will reduce the uncertainty when you need to claim.

Here are five points to consider:

· Select the most comprehensive benefits available to ensure that you are paid out when you really need it. If your budget requires you to take on “lighter” cover make sure that you fully understand what cover you have, what isn’t covered and when it will pay out.

· Make sure that your monthly income, after disability, is sufficient to maintain your lifestyle. The best way to ensure this is to have Lifestyle Protector’s new Income Protection benefits which pay a monthly sum insured if you are occupationally disabled or impaired.

· Never assume that your disability pay out (or critical illness pay out) will cover your medical expenses. The intention of a disability policy is not to pay for your medical expenses, but to make provision for the loss of income that you will suffer as a result of being disabled or impaired. A good financial plan should therefore always include some form of medical aid cover.

· Consider the impact of both permanent and temporary disability. Lump sum disability products only pay if you are considered permanently impaired or disabled. Income protection benefits pay for both temporary and permanent disability or impairment.

· Retrenchment cover is relatively expensive, yet a very important benefit to have. If you cannot afford cover to adequately replace your full income if you are retrenched do not disregard this type of cover completely, rather buy an amount sufficient to meet your non-negotiable expenses such as your children’s school fees, the mortgage payment, etc. Having at least some cover is always better than having none at all.

Liberty product updates

At Liberty we are constantly enhancing our products to meet your individual needs and have recently introduced new features to our risk products:

· Our new Income Protector solution allows you to take cover against occupational disability, impairment, critical illness (for both you and your spouse), retrenchment, death shortly after disability and even maternity.

· The Whole of Life Term option on Income Protector allows you to extend your cover past retirement age so that your income is protected against disability and impairment for the rest of your life.

· You are able to include Retrenchment Protector as part of your income protection cover. This will pay you out for up to six months in the event of retrenchment.

For a detailed financial needs analysis and expert advice on your specific risk cover needs, speak to your Liberty financial adviser today.