Protecting your lifestyle and your wealthLife assurance

Critical illness cover

Income protection

Key person and partnership protection

Over 30 years’ experience providing independent pension

advice to expatriates and people working abroad

Contents

Overview page 2

Life Assurance page 3

Critical Illness Cover page 5

Income Protection Insurance page 6

Whole of Life Assurance page 7

Key Person Insurance page 8

Wealth Protection Advice page 9

The small print

This guide is for general information purposes and does not constitute comprehensive advice on wealth planning. Before making any wealth protection decision or purchasing a related product you should seek professional advice.

The information in this guide was published in August 2013. 1

Be prepared for what could be around the corner

Most of us understand the importance of insuring our home, our car, and our

valuable possessions, however we often neglect to protect the things we value

most; namely, our loved ones and our quality of life.

A sudden illness, injury or fatality can affect any one of us at any time. If it affects

the main income earner in the home, the consequences can be wide-ranging.

Without adequate financial protection, the standard of life you are accustomed to

can be jeopardised, and so too the stability of your children’s education. Similarly, if

you own a business, the long-term illness or death of a key associate can threaten

the stability and income you derive from the venture.

While it is impossible to know whether any of these things will happen to us, we

can prepare ourselves for unwelcome events by ensuring we protect our loved ones

and our wealth sufficiently. This can be achieved through careful financial planning.

This guide looks at the various types of protection available to you.

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Life Assurance: Protecting your family’s lifestyle

‘‘We readily insure our possessions, but not

the source of income that pays for them’’

Talk to usClick here to arrange an informal chat about protecting your family

We work hard to achieve a standard of living we can enjoy. However, one of the

things we tend not to think about is how an unexpected death will affect our loved

ones’ lifestyle. Overnight, the loss of the main salary earner can raise questions

about remaining in the family home or the continuity of your children’s education.

Even the loss of a second income can disturb day-to-day life.

For peace of mind, you can protect your partner and any dependants against such

an eventuality with a life assurance plan.

Types of life assurance

Life assurance policies provide a lump sum to your dependants on your death.

There are two basic types of life assurance: term assurance and whole of life as-

surance.

Term assurance is taken out for a fixed period of time and is suitable for covering

financial commitments which have an end date, such as a mortgage or private

school fees. If you die within the period of the policy (‘the term’) a lump sum will

be paid to your beneficiaries.

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Whole of life assurance provides a lump sum no matter when death occurs. There

is no fixed period, or ‘term’, for the policy. This type of life assurance is designed to

provide funds to pay for liabilities on your passing away, such as inheritance tax, or

to form part of the legacy you leave. You can reduce your inheritance tax liabilities,

and avoid probate delays, by setting up your life policy within an appropriate trust.

How much cover do I need?

It is important to get the right type, and level, of life assurance for your personal

and financial circumstances. Ideally, you should have sufficient cover to pay off your

mortgage and any other financial liabilities, as well as being able to leave enough

funds for your dependents to maintain their standard of living.

You can set the size of the lump sum you would like your policy to pay out in the

event of your death. This, along with other factors, will determine your premiums.

An experienced financial adviser can help you to determine the appropriate level of

cover. Even if you have life assurance, it is a good idea to review your cover regularly

to ensure your loved ones stay adequately protected.

Life events and

life assurance reviews

Property purchase

Marriage or civil partnership

Taking on new debt

Children

Second home purchase

Job change

Retirement

Being supported by someone else

Protecting yourself and your loved ones from the financial effects of being unable

to work for a prolonged period, because of illness or injury, is important for your

financial security. If you are self-employed, not working means not earning, and you

may quickly have to resort to your savings to pay for bills. Even if you are employed,

your statutory sick pay is likely to be much less than you earn.

Income protection insurance allows you to maintain your lifestyle if you cannot

work for a protracted period, because of illness, injury, or disability.

Income protection plans

An income protection plan provides you with a monthly income if you are

temporarily unable to work for an extended period. Schemes vary but they typically

offer a monthly income for a specified period of time, for example, up to 2 years. If

you are later diagnosed with permanent disability you can receive a tax-free lump

sum to help you until retirement age or for a set number of years, depending on

your policy.

The idea behind income protection plans is to replace any income you lose, so

cover typically gives you 50-65 per cent of your pre-tax earnings. This is to take

account of tax you would have had to pay and any state benefits you can claim

while not working.

For self-employed people, some plans provide you with a monthly income based on

an average of your previous three years’ earnings, while others base payments on

your pre-tax share of gross profit,; after deduction of expenses.

Premiums for income protection plans vary according to the cover you have and

personal factors such as gender, age, health, occupation, and whether you smoke

or not.

Being diagnosed with a serious illness such as cancer, or suffering a heart attack

or stroke, can leave you and your family significantly worse off financially. Not only

may your income fall, because of reduced salary, you may also have additional

expenses, such as special care.

This unfortunate change in circumstances can soon start to affect your standard

of living, particularly if illness is long term. Not only that, if your children attend

private school or university, their education may be disrupted because of difficulty

with fee payments.

To protect yourself against the effects of unexpected illness, you can arrange

critical illness cover. This type of insurance provides a vital source of funds while

you or your partner recover, and gives your family peace of mind.

Critical illness plans

Critical illness plans are designed to pay you a lump sum on being diagnosed

with certain life threatening or debilitating conditions. The illnesses covered may

not necessarily be fatal. There is a wide variety of plans available and the more

comprehensive policies include a longer list of conditions. For example, they may

cover loss of sight, loss of hearing, and permanent disabilities.

The premiums for critical illness cover depend on a number of factors including the

type of policy, the size of lump sum, and your age. You can take out critical illness

cover on a term or whole of life basis.

Income Protection Insurance: Paying the bills if you can’t work

Critical Illness Cover: Ease your financial worries if you become seriously ill

CheCk poLiCy deTaiLs

It is advisable to check the

illnesses covered in a critical

illness plan to ensure it covers

you for what you expect. Any

exclusions and limitations will

be listed in the policy document.

If you are still unsure about

what is covered, consider getting

professional advice before you

commit.

The same applies if you are

thinking of replacing your current

policy or switching to a new one.

Pre-existing conditions may not be

covered by your new policy.

CheCk poLiCy deTaiLs

It is important to check references

to occupation in income protection

policies. This is because it may

affect whether you receive benefits

or not. ‘Own occupation’ means

that you can receive income if

you cannot perform your own job.

‘Any occupation’ on the other hand

means that you must be unable

to carry out any job before you

receive any monthly or lump sum

benefits. If you are unsure about

what is covered, consider getting

independent professional advice

before you commit.

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‘‘You are more likely to suffer serious illness than you are to die prior to retirement’’

Permanent health insurance

This name was used previously

to describe income protection

insurance schemes.

Inheritance tax has become a problem for many more people, either because

of substantial accumulated wealth or because of the value of their property; or

properties. One of the things you can do to prevent your hard earned legacy going

to the government instead of your loved ones is to open a whole of life assurance

policy. A whole of life assurance plan, written in trust, can be an effective way to

transfer assets liable to inheritance tax into a tax-free income in future.

Whole of life assurance policies, unlike term assurance, accumulate a cash value

and guarantee to pay a lump sum to your estate when you die. This money can be

used by your dependants however they wish; for example, to purchase their first

home, to fund their education, or to pay for funeral expenses.

Most whole of life assurance schemes include an investment element, the aim

of which is to generate greater wealth than the sum you contribute through

premiums. To reduce inheritance tax, and probate delays, you can put your whole of

life assurance policy in a suitable trust.

Regardless of inheritance tax issues, you can use a whole of life assurance policy

to create a legacy for your family - and protect them against the financial effects of

your premature death.

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Talk to usClick here to arrange an informal chat about protecting your legacy

You invest a lot of time, effort, and capital in building your business. However, if you

or another key member of staff were unable to work for a prolonged period, your

business’s profitability, even future, could be at risk.

A sudden illness, disability, or death can result in lost sales, extra recruitment costs,

and even loss of control of your business. The death of a partner or shareholding

director may mean that shares pass to someone with no knowledge or interest

in the business. This raises the prospect of your business being sold against your

wishes. Overnight, you could lose your livelihood.

To protect your business, you can arrange key person insurance, and shareholder

and partnership protection.

Financial help at a difficult time

Key person insurance – often called key man insurance – provides a lump sum if a

key member of your business falls seriously ill, suffers a debilitating disability, or

worse. This vital source of funds, at a difficult time, can be used however you choose.

For example, to replace lost income, recruit and train a successor, or supplement

salary payments.

Key people include those who make a major contribution to sales or profitability;

people with experience, expertise, or skills that would be difficult to replace; and

individuals who hold important customer relationships.

Stay in control of your business

Shareholder and partnership protection ensures the control of your business

remains with surviving partners or directors, if there is an unexpected death. This

type of protection is essentially an agreement between partners or shareholding

directors coupled with a life assurance policy. The life assurance plan makes sure

that the survivor, or survivors, has sufficient funds to purchase the deceased’s

shares. To avoid probate delays affecting the smooth running of your business, a

simple, yet effective, trust can be set up for shareholder and partnership protection.

Key Person Insurance:

Safeguard your

business’s future

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Whole of Life

Assurance:

Ensure your

legacy goes to

your loved ones

‘‘Key person insurance is particularly important if your business relies on a small number of people’’

We have specialised in providing independent financial planning and wealth management advice to expatriates and people working abroad for over 30 years.

A significant part of our work has involved helping people to protect what they have already, so that their families can continue to enjoy their present lifestyle. As a result we have acquired extensive knowledge of the type of cover offered by leading international and national providers of insurance solutions. So we are well placed to help you choose suitable protection for your family or business.

Recognising that everyone’s situation is unique, our consultants can also help you to determine the level of cover you need. Being impartial, and focused on the long-term loyalty of our clients, we will give you our unbiased opinion of the cover we think is right for you; explaining why, and pointing out your options. We will also review your cover regularly, as your needs change.

If you do not already have plans in place to protect your loved ones against unwelcome events, we recommend you take action soon. As well as protecting your family it could also save you money. Life cover, for example, usually costs more as we get older.

Make an appointment to discuss protecting your wealth – without obligationClick here to send us an enquiry

Call: +32 (0) 2 535 74 57

Email: protection@pic-europe.com

With offices throughout Europe we can meet you face to face.

Conversations will be in complete confidentiality.

Why we are

qualified to advise

you on protecting

your wealth

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Investments and investment management

Regular savings

Retirement planning

Pension transfers

Tax and trusts advice

Insurance including life, health, and disability

Education fees planning

Property financing, mortgages

Corporate services for international companies and organisations

Head quartered in Luxembourg, we are authorised and regulated by the Commissariat Aux Assurance (CAA). Our CAA Luxembourg registration number is 1999CM009.

We are fully regulated to offer our services in all EU member states under the Freedom of Services Act and have established branches under the Freedom of Establishment Act in:

Belgium (Financial Services & Markets Authority; FSMA registration number 1999CM009)

Portugal (Instituto de Seguros de Portugal; ISP registration number 1999CP012)

United Kingdom (Financial Conduct Authority; FCA registration number 453560)

None of the information, whether in part or full, should be copied, reproduced or redistributed in any form nor should it be regarded as an offer or a solicitation of an offer for investment. You should satisfy yourself, with your financial advisor, that the products and services offered are suitable for you and that you are not prevented from accessing such services or products by restrictions placed on you by the relevant fiscal authorities in your normal place of residence nor that it is unlawful for you to participate in such products or services as may be stipulated within the laws of the country, state or jurisdiction where you may either be a citizen or normally reside.

You should bear in mind that the value & prices of investments can go down as well as up, and you may not get back the full amount invested. Past performance is no guarantee of future performance. Currency fluctuations will affect the value of overseas investments. Emerging Markets can be more risky than developed markets. Current tax levels and reliefs may vary and will depend on your personal circumstances.

Independent financial planning

advice, wealth protection and wealth

management for expatriates and

people working abroad

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