Life Insurance, Income Protection, Critical Illness Cover, Private Medical Insurance…

There are plenty of ways to protect yourself and your family financially, but which should you prioritise?

The answer isn’t necessarily the same for everybody.

Rather than starting with a list of insurance policies, we think it’s more useful to start with the risks:

What would happen financially if you couldn’t work?

What would happen to your family if you died?

What would a serious illness mean for your finances?

How important is access to private healthcare to you?

Once you understand the consequences, it becomes much easier to decide which risks you need to protect and which you are comfortable managing yourself.

1. Protecting your income

For many people, their income is what makes everything else possible.

It pays the mortgage or rent, household bills, food, childcare and almost everything else involved in maintaining their standard of living.

So what would happen if illness or injury meant you couldn’t work?

Before considering insurance, start with what you already have.

How much sick pay would your employer provide and for how long? How much do you have in savings? Could your partner’s income support the household? If you’re self-employed, would your business continue producing an income without you?

Income Protection is designed to provide a regular income if you’re unable to work due to illness or injury, subject to the policy terms and conditions.

The cover can often be structured to begin after employer sick pay or other resources have been exhausted.

For somebody whose lifestyle depends heavily on their earned income and who has limited alternative resources, protecting that income could be one of their most important priorities.

2. Providing for the people who depend on you

Life Insurance is often the first type of protection people think about when arranging a mortgage.

Paying off the mortgage if somebody dies can clearly provide valuable financial security for those left behind.

However, the mortgage isn’t the family’s only financial commitment.

Even if the mortgage disappeared tomorrow, there would still be food, utilities, council tax, childcare, transport and everyday living expenses to pay.

This is why it’s useful to think about who financially depends on you and what they would actually need if you weren’t there.

Mortgage Life Insurance

Life Insurance can be arranged to provide a lump sum which could, for example, be used to repay some or all of a mortgage.

For couples or families where the surviving household would struggle to maintain the mortgage following a death, this can be an important part of their protection.

Someone who is single with no financial dependants may have a very different need for life cover.

Family Income Benefit

Another option is Family Income Benefit.

Rather than providing one large lump sum, Family Income Benefit is designed to provide a regular income following a valid claim for the remaining term of the policy.

For families with children or other financial dependents, this can be useful when the concern isn’t simply paying off the mortgage but replacing some of the income the household has lost.

Neither approach is automatically better.

The important question is what the people you leave behind would actually need.

3. What would happen financially after a serious illness?

Critical Illness Cover is designed to pay a lump sum if you are diagnosed with one of the specified conditions covered by the policy and meet the relevant definition.

People sometimes confuse this with Income Protection, but they solve different problems.

Income Protection is designed around your ability to work and normally provides a regular income following a valid claim.

Critical Illness Cover is based on diagnosis of specified medical conditions and normally provides a lump sum following a valid claim.

There can therefore be some crossover, but also important differences.

A critical illness could create costs beyond replacing your normal income. You may want money available to reduce the mortgage, make changes to your home, pay for additional support or simply reduce financial pressure while concentrating on your health.

How much Critical Illness Cover you need, if any, depends on what you would want the money to achieve and what resources you already have.

4. How important is access to private healthcare to you?

Private Medical Insurance (PMI) is slightly different from the other types of insurance we’ve discussed.

It isn’t primarily designed to replace lost income or provide your family with money following your death.

It is designed to cover eligible private medical treatment in accordance with the policy terms.

The important point is that we already have the NHS in the UK.

For many people, the NHS provides the healthcare solution they are comfortable relying on, so paying for additional private medical cover may not be a priority.

Other people place considerable value on having the option to access eligible private diagnosis and treatment, potentially having greater choice over where they are treated or accessing additional services available through their policy.

There isn’t a universal right answer.

It partly comes down to your own view of whether relying on NHS treatment provides an adequate solution for you and your family, or whether having access to eligible private treatment is something you value enough to insure.

Employer benefits are also worth checking. You may already have private medical cover through work, although it is important to understand what happens to that benefit if you change jobs or become self-employed.

5. What if you were made redundant?

Redundancy creates another financial risk, but it is quite different from being unable to work through illness.

Your health may be perfectly good. The problem is that your job and income have disappeared.

Some short-term insurance policies may provide cover for accident, sickness and/or unemployment, subject to their terms, eligibility criteria and exclusions.

Whether redundancy protection is a high priority can depend heavily on your circumstances.

Someone working in a profession with strong demand, substantial savings and good prospects of finding another role may be comfortable accepting that risk.

Someone in a highly specialised position, with limited savings and significant monthly commitments, may view it very differently.

It is another example of why insurance shouldn’t simply be bought from a standard checklist.

So, which insurance should come first?

Instead of automatically ranking insurance products from one to five, we would start with five questions:

1. If I couldn’t work, how long could I maintain my standard of living?

Look at sick pay, savings, your partner’s income and other resources.

2. If I died, who would be financially affected?

Consider the mortgage, but also the ongoing income your family would need.

3. If I became seriously ill, what additional financial support would I want?

Think about debt, household costs and any additional expenditure you might face.

4. Am I comfortable relying on the NHS for my healthcare?

If you are, PMI may be a lower priority. If access to eligible private healthcare is important to you, you may want to consider it.

5. What would happen if I lost my job?

Consider your emergency savings, employability and how long you think it might realistically take to replace your income.

Your answers help establish where the biggest gaps are.

Budget matters too

Very few households have an unlimited insurance budget.

Trying to protect against every conceivable risk could result in premiums that simply aren’t sustainable.

That isn’t the objective.

A good protection plan should concentrate on the financial risks that would have the greatest effect on you and your family, while taking account of the resources you already have.

You may have excellent employer sick pay but very little life cover.

You might have enough savings to manage without income for a year but feel strongly about having access to private healthcare.

Someone else may have no dependents and therefore little need for Life Insurance, but be completely reliant on their income to pay their mortgage and bills.

The priorities can be completely different.

Our Thoughts

Insurance shouldn’t start with the question:

“Which policies should I buy?”

We think a better starting point is:

“What could financially hurt me or my family, and what have I already got in place to deal with it?”

Some risks can be managed using savings, employer benefits, a partner’s income or existing insurance.

You may be comfortable accepting others.

Where there is a financial risk that you couldn’t comfortably manage yourself, insurance may provide a way of transferring some of that risk.

The aim isn’t necessarily to have every type of insurance available.

It’s to understand your own financial vulnerabilities, decide which ones matter most to you and prioritise your protection budget accordingly.

If you’d like us to review the protection you already have and identify any potential gaps, please get in touch.

Information correct at time of writing – October 2026.

Easy Street Financial Services Limited is authorised and regulated by the Financial Conduct Authority. FCA No. 1013595.