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17/07/2012
How can clients afford protection? The answer is down the back of the sofa

We have an electronic pass system at our office which means you have to swipe to get into the building beyond reception.

If I change suits during the week I might forget to put my pass in the new jacket pocket and so have to ask for a temporary pass. Of course when I go back to the original suit later on I often have the pleasure of finding a ten pound note in the pocket, or at least a pile of change.

Even though this money was mine all along it always feel as if I have just ‘found’ it for the first time. It’s like I’m suddenly ten pounds richer.

There are many ways that you can ‘find’ money you have almost forgotten about. I dump loose change into a bowl before using a coin counting machine every few months while even a cursory fumble down the back of the sofa usually reveals a few quid along with assorted toys and trinkets.

One of the reasons that many people give for not buying life insurance is that it is too expensive, or that they cannot afford it. And yet a 30 year old non-smoking lady can get £200,000 of life cover over 25 years for only a tenner a month. The same ten quid that you frequently find crumpled at the bottom of your pocket or stuffed down the back of a chair, could provide a lump sum equal to a small fortune.

How long would it take to build up £200,000 by saving ten pounds a month? Over 1600 years. Yet you could pay one premium of £10 into a life insurance policy and it could pay out £200,000 to your family immediately if you died in an accident.

Life insurance is actually amazing value for money and it has never been cheaper.

Look at it another way. Most of us now use smart phones and are used to buying apps. For an average of 69p, apps feel like great value because most of us have 69p fiddling small change in our pockets at the end of most days.

For 69p a month our lady could buy £13,800 worth of life cover.

Looking at it that way, most people definitely could afford life cover, simply because it isn’t actually that expensive.

Roger Edwards is proposition director at Bright Grey & Scottish Provident

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