Insurances - what do people REALLY pay for?

[Cara2323]

Insurances: what do people REALLY pay?

Hello, I dont know if I need a reality check please.

Myself (33yo) and my husband (39yo) have several insurance policies:

Home insurance: £19 p/m

- Life insurance and critical illness cover: this will provide a payout that covers the entire outstanding mortgage. Also includes the children if they were to be diagnosed with a critical illness as one parent may be unable to continue working if providing care

Me: £70 p/m

Husband: £102 p/m (his is more expensive as he's 6 years older and 39yo, and had an irregular heart beat investigated a couple of years ago, nothing came of it though).

- income protection: indefinitely pays out 80% of our salary monthly if too ill to work.

Me: £28 p/m

Husband: £49 p/m (he only gets basic sick pay, I get company sick pay for 6 months so his is more expensive)

-Family income protection: if one or both of us die then there will be a monthly payout until the youngest child turns 21yo (we have 2 kids) to the surviving parent or to them/their guardian. This is £12 p/m.

In total we pay £280 per month in insurance (not including car insurance as well of course). Is this mental? Have we lost it? Do most people pay this? Over the years as we had kids, upsized into a larger house, had salary increases etc this of course has crept up. But I'm just unsure if we're being mugs now?

Thanks in advance for any advice and/or perspective.

They're not all the same, but it feels like there is a bit of duplication going on - do you need the family income one if you get a life insurance payout and don't have a mortgage to pay off any more?

I have home insurance, but I don't have any of the others, except that my pension scheme has a death in service benefit included, which is one year's salary. But I suppose it also depends what your incomes are relative to your outgoings and what other assets you have - we have enough money to cover the things you're insuring yourselves against. I guess in your situation I'd sit down together and reassess things like: if you both died, what would your kids get and would they/their guardians actually need more? Could you get by on one of your incomes if you had to? etc.

We pay buildings and contents insurance which is around £30 a month, then the rest are through both of our work. We each have life insurance, critical illness, accident, income protection that we pay in total £50 a month as it’s subsidized heavily, then we also both have death in service and private health insurance too which are free. So £80 total a month.

Car and home only here. Retired but even when working I didn’t take the other insurances because we both worked and could (just about) manage the bills solo, had good sick leave / insurance at work plus I am an optimist!

Adds up.
I pay buildings, contents, car, travel, life, income protection.

Life is only a tenner, income protection £50. I did look at critical illness as well but decided it was too expensive and that income protection would have to do.

Why have the costs crept up so much? My premiums have stayed the same (but then so would the payout, so now my income protection would only be about half my current income, though as it happens that would probably be ok).

I think my question would be, are there cheaper alternative policies, and can you afford to build any savings while you are paying all this? Also do you have any death in service benefit that is free?

Having had a husband who died aged 52 though, it would have been blooming handy if he’d had life insurance. He was uninsurable though, and unfortunately you can become uninsurable very suddenly, so cancelling a policy isn’t to be taken lightly.

We pay for life and building insurance. Travel, health and dental insurance is covered by work, and we don't have a car. Don't need contents, critical illness or income protection insurance as we could pay for any costs needed by selling assets.

We pay £250/year house insurance including contents (often cheaper to pay house and car policies yearly rather than monthly). We pay £80 / year holiday insurance, £80/month combined life and critical illness including the kids insurance (this is the private insurance element, we also each would get 3x salary if we die whilst still working) and £450 year for 1 car fully comp. So average £145/mth for all insurance policies. Yours does sound high but your insurance pay outs may be higher. We're 46(f) and 40(m), with 2 kids.

I don't have any apart from buildings and contents.

We did once look at life insurance / payment protection but DH's dad died of a potentially hereditary illness at 42 and my mum had 2 cancers - both of which have a genetic link - before 50 so the costs of the premiums for us were sky high (£200+ per month) so we've never had anything. We are now in our 50s.

If you want those insurances to pay out you need to tell them everything about your health.

Building and Contents- £30
life and crit for the mortgage £50

Both have death in service pensions.

We have life, critical illness and accident insurance for all 5 of us. Income protection just for me. Free family worldwide travel insurance. Free family private health insurance.

Total cost is about £80 net a month - but I work for a bank so it's part of my benefits and we don't pay anywhere near the true cost. I don't think we'd get much change from £800 pcm or so if we paid for the levels of cover we have with external providers.