"I thought I knew a bit about Life Insurance – over the next year or so, I began to realise just how much more there was to learn."
- Kevin Carr, Managing Director at Carr Consulting & CEO of Protection Review
24 years ago, in the year Disco 2000 was set, my professional (and personal) life took an interesting turn. I had been a mortgage adviser for a few years before I decided to join LifeSearch as a telephone-based protection adviser.
I thought I knew a bit about Life Insurance – over the next year or so, I began to realise just how much more there was to learn. Guaranteed vs Reviewable, Single vs Joint, Standalone vs Accelerated, Terminal vs Critical, Own vs Suited…it goes on. An entire world of interesting (kind of) and valuable information.
For me, the job of a protection adviser is not to ‘sell’ protection, but to pass on knowledge as effectively as possible.
At the age of 25, I was living at home with my parents and thought, ‘I don’t have a mortgage or children, and I’m not married,’ but still…it might be a good idea to buy some of that protection stuff in case I need it in the future.
I was thinking ahead. I was young and healthy. I knew premiums were fixed.
So, I did.
I bought Income Protection (IP) and Life Insurance with accelerated Critical Illness (CI) which I have subsequently added to over the years after buying a house, getting married, and having children.
Since then, I have heard countless advisers suggest that some people believe buying protection in this scenario could be over-insuring or even mis-selling.
Did I mis-sell myself? If an adviser had ‘sold’ me those policies when I didn’t (yet) need them, could I complain to the Ombudsman Services and get premiums plus compensation reimbursed?
Last month, I asked my financial adviser how much it would cost to buy the same level of cover on a like-for-like basis in 2024. Over the remaining term, it would have cost £18k more than I paid – because I’m older and prices have changed. Of course, that doesn’t account for existing premiums already paid but if my health had worsened, it’s possible I wouldn’t have been able to get this cover at all.
What’s more, some of those policy definitions have changed over the years.
The cancer definition was weakened in 2001-03 when early-stage cancer became an additional payment condition. Likewise, coronary angioplasty used to be a 100% payment condition until 2002-10 but now it falls under additional payment condition.
Should I have bought standalone CI instead of combined with Life Insurance? Personally, I think combined makes more sense for the money and avoids technicalities such as the 28-day survival period for standalone CI.
I’d argue that buying some of that protection stuff when I was younger was sound advice.
