We recently were in discussions with a client about what protection they had in place if they or their partner got sick. Our client was surprised, as she only associated claims from a life assurance company with pay-outs when people die. We were delighted to then be given the opportunity to paint a far broader picture for her than this.

‘Living benefit’s dominate

Living benefits are payments made to policyholders when they are sick rather than if they die. We looked at claims data from Irish Life In 2023 which revealed that two out of every three claims paid by Irish Life were for living benefits – specified illness cover and income protection. These claims are paid when people suffer a specified illness or are regular payments when people are unable to work because of an accident or illness.

Living benefit claims are significant too

These living benefit amounts are also certainly not paltry amounts! In 2023, the average specified illness claims paid by Irish Life was just under €65,000. While of course we all want our health never to be compromised, a payment like this would certainly relieve some of the stresses associated with a serious illness.

Income protection claims are regular payments paid out (usually monthly) until the claimant either reaches retirement age or returns to work. Last year overall Irish Life payed out more than €1m in Income Protection claims per week.  

Becoming ill is an expensive business…

This is a sad but true fact of life. When we take out a mortgage, the bank insists on life assurance to repay the mortgage in full in the event of death. People often have the foresight to have additional cover in place to safeguard the futures of their bereaved family.

However, illness can also be a devastating financial event. The claimant may be unable to work, and their income may cease immediately or quite quickly afterwards. Unfortunately, the mortgage repayments or rent still have to be met, as do the rest of the normal household expenses. On top of this, there may be additional expenses as a result of the illness – a carer, personal care requirements and sometimes homes need to be adapted to make life manageable for the patient.

This is not an either / or situation (life assurance v living benefits), it is about getting the right cover package in place for your family and for your specific circumstances. We would be delighted to hear about your individual requirements, and like our inquisitive client mentioned earlier, we would love to help you fully protect yourself and your family.