Insurance policies do pay out; if you buy wisely
April 15 2010
According to the Association of British Insurers, the UK insurance industry paid out £57m per day in 2008; between 1998 and 2008 general insurance claims increased by 41% from £15.6bn to £22bn.
These figures give the lie to the accepted version that insurance companies “never pay out on a claim” but the analysis of complaints suggest this not to be true. The FOS reported that PPI complaints tripled in 2009 but the vast majority related to the sale of the insurance policy rather than the claim.
So what is the truth? When purchasing a policy most people look for the bottom line; which one is the cheapest almost irrespective of which insurance policy is the best. This means that almost from the start the consumer has a policy that was not bought with their individual needs in mind rather focusing on their financial needs.
When the policy finally arrives some consumers will barely give it a second glance, consigning it to the document draw never to see the light of day again until the need to claim arises, by which time the lack of attention to detail at the buying stage could become an issue.
Buying an insurance policy can be difficult; it does take time and some considerable patience but if you consider the importance of it then this is time well spent. If when you purchase an insurance policy such as mortgage protection, you should always carefully check the details and make sure that it is suitable for your needs and that you understand the eligibility criteria both for applying and claiming, then you will be one of the lucky ones who will receive the monthly claim cheques when you lose your income or have occasion to claim.
The insurance industry, in spite of its poor press, is there for a reason and when the criteria is met they will pay out; but they cannot be wholly responsible if a consumer decides that the most important decision they may make can be reduced down to a quick glance and a cursory nod in the direction of the small print.
Approved mortgages and house prices fall
April 14 2010
The British Bankers Association reported that the number of approved mortgages fell to an eight month low last month. Almost simultaneously it was announced that houses prices had dropped for the first time in 10 months. This does not auger well for those still looking to obtain a mortgage to buy a property.
Banks are there to make a profit. In a falling market it is just a matter of mathematics as to whether a mortgage should be given or not. In the old days a bank or building society would lend up to 100% of the value of the property; in a rising market this was acceptable because the bank, in the event the buyer could not repay their mortgage, would make a profit on the deal when they repossessed it. However in a falling market the opposite happens and the bank stands to make a loss if the buyer could no longer repay their mortgage and the house was repossessed.
After a short period of upward movement, house prices now appear to be taking a dip and therefore the banks are nervous of this falling market. It seems that mortgages are still a limited commodity and may be so for some time to come.
Mortgages, and in particular good mortgage deals, are now becoming increasingly difficult to obtain. Only those with very high deposits can take advantage of the limited packages being offered so it may be some time yet before the financial markets are confident that the house prices have found their level.
Mortgage protection insurance protects against loss of earnings or sickness so it is always worth considering a good mortgage protection insurance as offered by Antinsurance.
Safeguard the mortgage deposit you loan to your children
September 9 2009
More and more parents are using their retirement savings to help their children onto the housing ladder so they need to ensure its return.
More and more children are turning to their parents to help them secure the necessary deposit to get on the housing ladder. In September 2007 the deposit required was in the region of £13,194 but this has now almost doubled to £32,000 putting it out of the reach of many desperate to get onto the first rung. Records show that a total of £116bn has already been loaned by parents to their offspring.
Many parents are nearing retirement age and therefore the money they are giving is paramount to those retirement plans and the assumption is that the retirement will be supplemented by the loan being repaid in monthly instalments. However the fall in property prices and the continuing uncertainty in the workplace does not make those repayments certain and, in some instances, could cause the total loss of the whole loan.
Parents are therefore now actively encouraging their children to take out protection for these loans either by way of Life, Mortgage or Critical Illness cover. For those parents who do not have excess retirement funding in place, lending the initial deposit to your children can be a very high risk move so it is wise to ensure that loan is covered in the event of a worst case scenario.
