By Dave Kavanagh

Having appropriate cover in place for you and your family is obviously important, whether it is Life Cover, Serious Illness Cover or Income Protection. What is equally as important, is knowing the details of the cover that you have in place. As time moves on and circumstances change, what was relevant for you 5 years ago, may not now be appropriate for your needs. I remember giving a talk to a group of about 50 parents, all of whom raised their hands to signal that they all had cover in place. I then asked how many of them knew (without needing to divulge to the group) which Life Company their cover was with, how much was the monthly premium and what the levels of cover were? Of the 50 parents present, not one of them raised a hand, despite paying for these plans for a number of years. Simple changes in circumstances can make it crucial to review cover details. Starting new employment that may include a multiple of annual salary as a death in service benefit, as well as income protection and a pension, could mean that other cover in place could be reduced or removed. The reverse is often seen where someone had great benefits attached to their employment but then moved to a job that does not provide any benefits at all and had not considered that they need to arrange their own cover.

Another issue that people are often not aware of, is whether any cover they have has a Conversion Option. This is an option that allows people to convert to a new, longer term plan, without any further evidence of medical health. This can be crucial if a plan is reaching maturity or if someone has experienced adverse health issues, where they may not be accepted for cover due to their new medical history or may be subject to restrictions and/or premium loadings. Having the ability to exercise a Conversion Option allows you to “future proof” cover to suit your specific circumstances. While not a fun exercise, making some time at least once per year to review the details of any cover you have in place can be a valuable exercise. If you’re unsure about some of the details, contact your advisor.

Dave Kavanagh QFA has been advising people financially for over 25 years. For quotes or information (with no cost or obligation) he can be contacted by emailing info@financialcompanion.ie or use the contact form on financialcompanion.ie or @Davekav_advice on Twitter and Instagram. Combined with his previous role of gym/nutrition adviser, he regularly gives talks and workshops at seminars and events for groups, companies and government departments on financial wellbeing, positivity and motivation. As heard on RTE 2FM , LMFM and TV3.