The Association of British Insurers has called on consumers to protect themselves and their families from sudden loss of income by ensuring they have a well-designed suite of personal insurance products in place.Â
In its new document ‘People Need Financial Protection’, the ABI refers to the current ‘uncertain economic outlook’ and warns consumers against ‘a sudden loss of income, perhaps through unemployment, ill-health, or even the unexpected loss of a family breadwinner’.Â
In addition to health issues, insuring your ability to repay debts was crucial in order to avoid damaging your credit rating, and therefore your ability to borrow money in the future, the ABI said.Â
The ABI recommended the following insurances as part of a sustainable and balanced household financial plan.Â
Life Insurance – To provide a tax-free lump sum or regular income in the event of death
Critical Illness Insurance – To pay a tax-free lump sum if you suffer a specified critical illness such as cancer, heart attack, or stroke
Income Protection Insurance – Pays a regular income if you are rendered unable to work through illness or injury
 Unemployment Cover – Pays a regular income or covers debt or mortgage repayments if you lose your job through no fault of your ownÂ
Consumers without a ‘buffer’ of savings to sustain them in the event of unemployment were particularly well-advised to ensure they had adequate life cover, health cover, and criticial illness insurance cover, said the ABI.
