Coronavirus Financial Protection: What You Need to Know
As a contractor, we understand that the current climate may be leaving you with some questions about your finances. Perhaps you’ve had a contract postponed, cancelled or you’re working as usual but want to be better prepared for what’s around the corner.
To help give you some peace of mind, our partners at CMME have put together an FAQ regarding financial protections for contractors in response to the questions we know are on many a contractor’s mind during this unprecedented time.
It is important to note that protection providers are constantly reviewing their policy terms and conditions as events unfold. For the most up to date information, speak to CMME direct on 01489 223 750.
What types of financial protection should I consider in the current climate?
Income Protection Insurance: Replaces part of your income if you are unable to work for a long period of time because of illness or disability.
Critical Illness Insurance: Pays out a lump sum if you’re diagnosed with a critical illness. You can use the pay-out for anything such as, to pay for medical treatment or to pay off your mortgage.
Life Insurance: This will ensure your family is taken care of in the unfortunate event of something happening to you.
Managed Life Cover: Bespoke cover for sufferers of type 2 diabetics and people with a high BMI.
Real Life Cover: Cover for people living with a serious medical or mental health condition – such as cancer, complex heart conditions, anxiety, alcohol dependency – that may lead to an exclusion from a standard plan.
Do they all cover Coronavirus?
Income protection will provide a monthly income if you are signed off work due to an accident or illness, including Coronavirus. Some providers will also consider a claim for those infected with the virus and in isolation or quarantined beyond the deferred period without the usual GP certification. But most providers do not expect to see any claims for self-isolation, as the required isolation period will fall inside the deferred period, which is usually 4 weeks.
Life cover will also cover Coronavirus, unless you have already tested positive for coronavirus, have had symptoms or have been told to self-isolate. In the latter case, you should only consider yourself to be self-isolating if:
- medical staff have specifically advised them to do so
- they’ve been advised to shield for 12 weeks due to being defined on medical grounds as being extremely vulnerable from Coronavirus
- they’re self-isolating due to symptoms they have or have tested positive for Coronavirus
- they’re following guidance due to being in direct contact with someone who has symptoms (household isolation)
- they’re following guidance having recently returned from an affected area
Critical illness does NOT cover Coronavirus in itself, unless it results in a critical illness. Common signs of Coronavirus infection include respiratory symptoms, fever, cough, shortness of breath and breathing difficulties which are mostly overcome. In more severe cases, infection can cause pneumonia, severe acute respiratory syndrome and kidney failure, which are then typically covered in a critical illness policy.
What if I have or have had Covid 19 symptoms – can I still get cover?
You will either get cover with a coronavirus exclusion or be postponed until you recover.
As a Key Worker, can I still get cover?
Absolutely. All key workers will have access to the same protection, regardless of their type or place of work. In addition, clients working in occupations covered by NHS sick pay but not directly employed by the NHS can also be covered.
Will I need a medical to get cover?
Not necessarily. We can advise our clients on how to set up cover without having to do a medical check so that they do not have to leave the home or see anyone from outside of their household.
Are premiums higher at the moment because of the outbreak?
There has been no evidence that providers will be increasing premiums in response to the outbreak, at least not in the short term.
Why should I use a broker?
Using a broker can be useful in helping you to fully assess your financial protection needs and ensure you get the best cover for your specific circumstances. At CMME, we work with a broad and diverse panel of protection providers, many of whom specialise in protection for self-employed professionals. All conversations are free of charge and completely confidential, without any obligation to proceed.
CMME is one of the UK’s leading financial advisory services for umbrella contractors, specialising in Mortgages, Protection and Financial Planning through our sister company Contractor Wealth.
Help from SJD Accountancy
If you have concerns around the finances of your limited company during this time, or are looking for advice on what help is available, please speak with your accountant or choose how to get in touch with us here.