Richard, 35, and his wife Claire, 32, live in London. They have an 18-month-old son called Samuel. Richard is a journalist and Claire is a part-time secondary school teacher. Their combined salary is £52,000. They recently bought a new house and as part of the purchase, they took out mortgage payment protection insurance, which is currently the only protection they have. Ideally though, they would like to get more comprehensive cover. However, they cannot spend more than £80 a month. What options are available to them?
Richard Verdin, Direct Life and Pension Services We have assumed that Richard is a self-employed journalist who does not work abroad, and that he is on a gross salary of £40,000. Because he is self-employed, he has no sick pay. Meanwhile, we have assumed that Claire is on a salary of £12,000 and is paid full sick pay for six months. With regard to the mortgage, we have assumed this is a repayment mortgage of £150,000 over a 25-year term, with a typical repayment of £930 a month. The first priority is to take out a mortgage protection policy to pay off the outstanding mortgage balance in...
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