Your Questions: We’ve a lot of policies but do we have too much insurance cover?

Question: I FINALLY sat down to review our household budget and I’ve discovered we have insurance cover for a few things and I’m not even sure what they are, or if we need them. We have mortgage protection with our bank since we took out our mortgage 15 years ago. My wife has serious illness cover from €50,000 paid by her employer. And I took out an income protection policy seven years ago, but I’m also paying for serious illness cover of €70,000. Do I need both? We have two children in school.

Answer: You should first review your mortgage protection policy. If you have been with the same provider for 15 years without reviewing cover then it may not be adequate for your family’s circumstances, according to Joey Sheahan of Sheahan Financial in Dublin and Cork.

There are lots of providers on the market offering good value, so you should be assessing that you have sufficient cover and you are getting the best deal, he said.

Serious illness cover pays out a lump sum if you are diagnosed with various illnesses specified in your policy document. You do not need to be out of work for any period of time in order to make a claim.

It is important to review the different illnesses covered by each insurance company. For example, out of six companies in the Irish market, just three companies cover chronic pancreatitis, Mr Sheahan said.

With income protection you need to be out of work and without pay for a period of between four weeks and 52 weeks before you can claim.

Most illnesses are covered, but some pre-existing illnesses such as back problems may be excluded.

Some people may have their own income protection policy, but may also have cover from their employer so could be “doubly insured”.

In the event of a claim they cannot claim twice, so it’s important to ensure you are not over-insured.

Both protection policies can assist with monthly household expenditures, but it is important to review all policies every two to three years, he said.

Question: How far back can I go with a complaint to the Financial Services Ombudsman?

Answer:The Financial Services and Pensions Ombudsman is an independent officer whose remit is to investigate, mediate and adjudicate unresolved complaints of customers about financial service and pension providers. All personal customers of regulated financial institutions can make complaints to the Financial Services and Pensions Ombudsman.

A six-year limit normally applies to all cases. This means the ombudsman will not investigate a case arising from events that happened more than six years ago.

However, for long-term products, you can make a complaint to the ombudsman within any of the following limits:

• Six years from the date of the conduct concerned.
• Three years from the date on which you became aware, or ought reasonably to have become aware, of the conduct concerned.
• Where it appears to the ombudsman that there are reasonable grounds for a longer period and that it would be just and equitable to extend the time limit.

A long-term product is a financial product with a term of five years and one month or more, according to the ombudsman’s office. An example of this is a mortgage.

Question: I am looking to take out a life insurance policy for the first time. I am 45, in good health generally but am an occasional smoker. I have been moving over to a vape recently and I intend to quit in the new year. While I am sure smoking will have some impact on my chances of getting an affordable policy, I wonder if it is the same for vaping?

Answer:Smokers pay a lot more for life cover, mainly as the chances of dying young are so much greater than for non-smokers.

When it comes to vaping, different insurers have different rules for this, according to Mike Knightson of KM Financial in Charleville, Co Cork.

Some classify ecigarettes as smoking, and so smoker rates will still apply.

Results from studies into the effects of vaping on long-term life expectancy are still forthcoming, but there is an expectancy within the insurance industry that vaping will be included under the “smoker” classification in the short- to medium-term.

If you do manage to kick the habit you only need to be nicotine-free for 12 months in order to be recognised as a non-smoker for life cover purposes.

This will make non-smoker rates available to you, significantly reducing the cost of any plan you might be interested in.

With income protection you need to be out of work and without pay for a period of between four weeks and 52 weeks before you can claim

If you do manage to kick the habit you only need to be nicotine-free for 12 months in order to be recognised as a non-smoker for life cover purposes