FAQs

If you provide advice, designs, or professional services, you should strongly consider professional indemnity insurance. Without it, you could face costly legal fees and compensation claims if a client accuses you of negligence.

Additionally, many clients require professional indemnity insurance before entering into contracts, and industry associations may have minimum coverage requirements for membership.

Professional indemnity insurance protects against a wide range of claims, including:

• Management consultants – A business plan you provide doesn’t deliver expected results, and the client claims for financial losses.
• IT contractors – A website, app, or software is not fit for purpose, and the client claims for rectification costs.
• Engineering contractors – CAD work contains incorrect measurements, delaying a project, and the client claims for extra expenses.
• Fitness professionals – A client sustains an injury and claims that you failed to properly instruct them.
• Photographers – A client is dissatisfied with your work, or images are lost due to technical failure, leading to a claim for reshoot costs.
• Tutors – A student fails to achieve expected grades and claims for financial losses related to missed opportunities.

Yes. Your insurance provider will issue a Confirmation of Liability Insurance document or similar, which you can present to clients and agencies as proof of coverage.

No, most professional indemnity policies run for 12 months, and for good reason.

Professional indemnity insurance operates on a ‘claims made’ basis – meaning:

• Your policy must be active both at the time of the alleged incident and when the claim is reported.
• If you cancel your policy and a past client makes a claim, you won’t be covered.

Maintaining continuous cover ensures protection for work completed in previous contracts.

Check if your client or industry regulator requires a minimum level of cover.

If no minimum is specified, consider worst-case scenarios and the potential costs of rectifying a mistake. iPro, our preferred partner, offers coverage between £50,000 and £5 million, ensuring the right protection for your business.

Cyber protection insurance helps businesses recover from cyberattacks, data breaches, and system failures. It typically covers:

• Financial losses due to hacking, ransomware, or data theft.
• Legal and regulatory costs associated with data breaches.
• Notification and credit monitoring for affected customers.
• IT forensics and recovery services to restore compromised systems.

Yes. Small businesses are increasingly targeted by cybercriminals due to limited cybersecurity resources. Cyber insurance helps mitigate risks, ensuring financial and operational protection against cyber threats.

Public liability insurance covers injuries or property damage caused by your business operations. If a customer, supplier, or member of the public is injured or their property is damaged due to your business activities, this insurance covers legal fees and compensation claims.

There are three main ways to set up shareholder protection:

• Own life plans under business trusts – Each shareholder takes out a policy on their own life, written in trust for the benefit of other shareholders.
• Life of another plans – Each shareholder owns policies on the lives of other shareholders.
• Company-owned plans – The company takes out policies on shareholders to fund the buyback of shares.

Speak to your Broadbench financial adviser to determine the best option for your business.

Also known as a double-option agreement, this gives surviving shareholders the option to buy shares from the deceased shareholder’s personal representatives.

• If either party wishes to exercise their option, the other must comply.
• The option can only be exercised after death, within a specific timeframe.

No. If a shareholder passes away while owning shares in an unquoted trading company, 100% Business Property Relief (BPR) may apply for inheritance tax (IHT) purposes, as long as the shares were held for at least two years.

Even if the estate receives cash for shares under a cross-option agreement, BPR is preserved because:

• The option is only exercisable after death.
• There is no binding contract to sell at the time of death.

A buy/sell agreement would deny Business Property Relief.

• Shareholders agree that, upon the death of one, the remaining shareholders must buy their shares, and the estate must sell.
• Life insurance is taken out to fund the purchase.

Since this creates a binding contract at the time of death, HMRC treats the shares as already converted into cash, making them fully subject to IHT.

A critically ill shareholder may be unable to contribute to the business and may want to exit. Their co-shareholders will need funds to buy their shares.

• If a business trust is used, a policy with critical illness cover can be written under the trust.
• Instead of a cross-option agreement, a single-option agreement is recommended. This ensures that a critically ill shareholder is not forced to sell against their wishes.

A forced sale could trigger capital gains tax (CGT) and future IHT liabilities, as the shareholder would receive cash instead of retaining shares that may qualify for IHT Business Property Relief.

If a shareholder receives a critical illness payout but chooses not to sell their shares, we recommend keeping the proceeds within the trust until the succession issue is resolved.

Although the funds might be available, they were intended for share buyout purposes. Distributing them to the critically ill shareholder could lead to tax complications.

Yes, there is a potential Pre-Owned Asset Tax (POAT) charge.

POAT is an income tax charge applied when someone benefits from an asset they previously owned. While Business Trusts used for shareholder protection fall under POAT, in most cases, the annual benefit remains below the £5,000 tax-free limit.

• The charge is 2% of the open market value of the life plan (subject to official rate changes).
• While the insured person is healthy, the market value is low, meaning no charge applies.
• If they become critically ill and the funds remain in trust, the value increases, potentially triggering POAT.

To avoid this, the settlor (original policyholder) can be removed as a beneficiary of the trust. However, this may have IHT implications, which should be reviewed with a Broadbench adviser.

When a business takes out a loan, a specific shareholder(s) is usually responsible for repayment. Business loan protection is taken out on the individual responsible for the repayments. If the business is a limited company, the business itself is the policyholder. In the case of a partnership or sole trader, the individual owners hold the policy.

Our expert advisers can help tailor a policy to fit your business needs.

Not exactly. While key person insurance can sometimes be used to cover business loan repayments, there are key differences:

• Business loan insurance must match the outstanding loan amount to ensure full coverage of repayments.
• It must be in place for the duration of the loan, whereas key person insurance covers the length of a key individual’s employment.

Business loan insurance can cover various types of loans, including:

• Commercial loans or mortgages on business premises
• Venture capital loans taken during startup or expansion
• Director’s loans—funds paid to a director or their family that do not count as salary or dividends

No, there is no legal requirement to take out business loan protection.

However, lenders often require businesses to provide security to guarantee loan repayment, making business loan protection a highly recommended safeguard.

Yes, in many cases, business loan insurance can be adjusted or transferred to cover a refinanced loan, as long as the coverage aligns with the new loan amount and terms.

If the person covered by the business loan insurance leaves the company, the policy may need to be restructured or reassigned to a new individual responsible for the loan repayments. Our advisers can help ensure continuous coverage in such cases.

The cost varies based on several factors, including:

• Number of employees
• Company location
• Employee ages and family status
• Underwriting type, which depends on whether you already have health insurance coverage

Coverage options, excess levels, and hospital choices can be customized to fit your employees’ needs.

Yes. If you’re a director of a limited company or a sole trader, you may be able to claim business health insurance as a tax-deductible expense.

To qualify, ensure you purchase a business health insurance plan, not a personal health insurance plan, as personal policies may not be eligible for tax deductions.

Our expert advisers can help tailor a policy that meets your business needs. Contact us to discuss your options.

Coverage depends on your policy but can include private hospital treatment, specialist consultations, diagnostic tests, and mental health support. Some plans may also offer dental and optical care.

Yes, many business health insurance plans allow employees to add family members at an additional cost. This can be a valuable employee benefit.

If an employee leaves, they can often switch to a personal health insurance policy without needing to reapply. You can also adjust your business policy to remove them from coverage.

Executive Income Protection (EIP) covers an employee’s sick pay if they are unable to work due to illness or injury. The benefit is paid to the company, which then passes it on to the employee, with tax applied at that stage.

The policy is owned and funded by the business, not the insured individual.

You can choose the policy duration, but it cannot extend beyond your retirement age.

A short-term income protection plan provides coverage for a portion of your income if you’re unable to work due to illness or injury, typically for up to 12 or 24 months per claim.

A long-term policy covers a portion of your income until you either return to work or the policy expires. Most plans offer coverage up to retirement age.

The deferral period is the waiting time between becoming ill or injured and when you can start claiming benefits. Shorter deferral periods increase the cost of the policy.

For example, if you have three months of sick pay and savings to cover two additional months, a five-month deferral period may be suitable.

Waiver of premium is a feature that covers your insurance payments while you’re claiming benefits. This is typically included as standard with executive income protection.

It’s simply a business insuring itself against the financial loss it may suffer as a result of the death (or critical illness if chosen) of a key person.

A key person is an individual whose skill, knowledge, experience or leadership contributes to the continued financial success of the business. A key person may be anyone whose death could lead to a financial loss for the business.

This might be a loss of profits if you lost your best salesperson, the cost of having to recruit or train a replacement or important personal or business contracts lost due to the key person not being there to maintain a contract.

For a business to insure one of its key people it must show that it stands to suffer a financial loss of profits as a result of the death, terminal or critical illness (if chosen) of that employee.

This is usually straightforward, and that individual is then regarded as a key person. The loss of a key person could lead to the business being unable to repay a loan, which could mean the lender calls in the loan early. This may have a serious effect on any existing loans or any future lending.

Usually, a limited company or a corporation with shareholders whose liability is limited by their shareholdings. Any personal assets are held separately from the finances and assets of the company.

As the company is the owner of the policy it would usually pay the premiums.

In the event of a valid claim, the policy proceeds would be payable to the company.

A partnership is a relationship which exists between persons carrying on a business in common with a view to profit. The partnership does not have a separate legal identity and each partner would be liable for any trade debts. It is the partners and not the partnership itself which will own any policy.

Yes, a partner could take out their own life policy and place it under trust for the other partners. In the event of a valid claim the policy proceeds would be payable to the trustees who would in turn pay the partners as beneficiaries of the trust. The partnership would usually pay the premiums.

It’s not a nice thing to think about, but if you’re a contractor and you pass away, how would your loved ones survive? This is where Relevant Life Insurance can provide the answer. It pays out a large one-off sum to help your family live after you’ve gone. Plus, a Relevant Life policy offers some very special advantages to limited company business owners and contractors looking for life cover. The headline benefit is tax efficiency.

While the life cover is personal to you, the policy counts as a legitimate business expense, so it is tax deductible. Learn more about how a Relevant Life Policy could be suitable for you by contacting us.

You must have a limited company to benefit from the tax savings that a relevant life insurance policy offers. If you do not have a limited company then standard Life Insurance will offer you the protection you need.

No. There’s no cash value at any time. Just like standard Life Insurance at the end of your Relevant Life Insurance policy term you stop making payments and your cover ends.

If you have an interest-only mortgage, your outstanding mortgage loan stays the same until you repay it at the end of the mortgage term. Level Relevant Life Insurance could cover this type of mortgage.

Like standard Life Insurance, it provides your loved ones with a large tax-free, one-off payment, or monthly payments if you pass away. It can be used to pay the mortgage off or help your family with living expenses. You are covered only for the duration (term) of the policy and cover only lasts while you keep up monthly premiums. Monthly payments can be reduced by combining this with a Critical Illness policy.

The key difference between Life Insurance and Relevant Life Insurance is that with Relevant Life Insurance the cost of the premiums is moved from your own pocket to your company expenses. This saves you tax and reduces the cost of your monthly premiums.

Additionally, this is not treated as a benefit-in-kind; the premium is not included as a P11D benefit, nor are premiums subject to National Insurance payments for the employer or employee.

There is significant tax relief with a Relevant Life plan and your business can claim Corporation Tax Relief on the premiums. Plus, the payout itself is tax-free.

If the unexpected happens, you’d want your family to be taken care of. You’d want the mortgage paid off and enough money for them to live. It’s important to get this right, which is why we work closely with you, making sure the cover fits your needs but is also affordable for you. The policies we recommend are handpicked for contractors, and we’ll cut through any jargon, so you know exactly where you stand.

If you choose level or decreasing cover, your monthly payments are guaranteed to stay the same for the duration of your policy. For decreasing Relevant Life Insurance, premiums are set at the start of the policy to consider the decreasing amount of cover you’ll need during the policy term. Premiums for decreasing cover are often cheaper than other types of life insurance.

With level cover, if you choose to help protect your payments from the effects of inflation, so the lump sum won’t be worth less in the future, your monthly payments may rise. The maximum annual increase would be 15% to your premiums and 10% to your cover.

You should notify the claims department of your insurer, you will find this contact info on the policy documents or their website.

Inheritance Tax (IHT) applies to all UK domiciles, regardless of whether they live in the UK or abroad, subject to the nil-rate band. There is no IHT due on estates valued under £325,000.

Your domicile is typically determined by your father’s domicile at birth (or mother’s, in some cases). This means that even if you were born outside the UK or live abroad, your domicile is linked to your father’s domicile. Living abroad does not automatically change your UK domicile status.

IHT applies to worldwide assets, including property, savings, investments, and other valuables. Some reliefs may apply, such as business relief and agricultural land relief, which can reduce the amount of tax owed.

UK domiciles are liable to pay Inheritance Tax on their worldwide assets. Even if no IHT is due, beneficiaries must report assets to HMRC. Gifts made more than 7 years before death are generally exempt from IHT, but be aware that IHT legislation may change, so it’s always best to consult your Broadbench financial adviser.

Yes, if you are a UK domiciled individual, you are required to pay IHT regardless of where you live. You may also face local inheritance taxes in your new country of residence. To avoid being taxed twice, it’s advisable to check for double tax treaties between the UK and your new country.

UK IHT is charged at 40% on estates valued over the £325,000 threshold. However, certain exemptions and reliefs can apply, such as the 36% rate if 10% of the estate is donated to charity.

Each individual has a nil-rate band (NRB) of £325,000, meaning no tax is due on the value of the estate up to this amount. Married couples or civil partners can combine their NRBs, effectively doubling the allowance to £650,000.

Spouses or civil partners can transfer assets tax-free between each other, with no limit on the value of assets. However, the recipient must be UK domiciled to benefit from this exemption.

“New for old” means that if you make a claim, your insurance provider will replace the damaged or stolen item with a brand-new one of the same make and specification. However, this does not apply to clothing and household linen, where a deduction for wear and tear is made.

The rebuilding cost of your home is not the same as its market value. It represents the amount needed to completely rebuild your home, excluding the value of the land.

You can check your current home insurance documents, surveyor’s report, or mortgage valuation (if done in the last two years) for the rebuild cost. Alternatively, you can use the BCIS rebuild calculator for an estimate: BCIS Rebuild Cost Calculator.

An excess is the portion of a claim you are responsible for paying before your insurer covers the rest. The higher the excess you select, the lower your premium. You can adjust your excess amount at any time.

Some claims have specific excess amounts, such as a £1,000 excess for subsidence, heave, or landslip claims, which will be detailed in your policy schedule.

Yes, but only if you have selected the appropriate cover. The following optional add-ons provide protection for personal items outside the home:

• Personal Items – Covers valuables such as jewellery and handbags.
• Technology & Entertainment – Covers gadgets, laptops, and tablets.
• Pedal Cycles – Covers bicycles.

Check your policy schedule to confirm what is included.

No, home insurance covers sudden and unexpected damage. It does not cover items that have naturally worn out over time, broken down, or been poorly maintained. Keeping your home and possessions well-maintained is essential, as insurance is not a substitute for proper upkeep.

Exclusions vary by policy, but all important exclusions will be outlined in the “What is not covered” section of your policy documents. Reviewing these details ensures you fully understand your coverage.

If you rent out a property, standard home insurance may not be enough. Landlords face additional risks, such as:

• Tenant-related damage
• Loss of rent
• Liability claims from tenants

By informing us that your property is rented out, we can tailor a policy to suit your needs.

Landlord insurance covers typical home insurance risks, plus additional protections designed for rental properties, including:

• Loss of rental income if tenants can’t stay due to damage.
• Alternative accommodation costs for tenants if your property becomes uninhabitable.
• Property owner’s liability in case a tenant or visitor gets injured.

Whole of Life insurance provides a guaranteed payout when you pass away or are diagnosed with a terminal illness. It’s often used to leave a financial legacy for family, pay off debts like a mortgage, or cover funeral costs. You can choose the level of cover that best suits your needs, but this type of policy is only available through a financial adviser.

Whole of Life insurance has no cash-in value at any point. If you stop paying your premiums, your cover will end immediately, and you won’t receive any refunds or payouts.

A Broadbench financial adviser can help tailor a policy that meets your unique needs and budget. Their expertise ensures you get the most suitable cover, helping you avoid unnecessary costs or gaps in protection.

Yes, joint Whole of Life policies are available. They are typically more affordable than two separate policies but usually pay out only once—either when the first person on the policy passes away or, in some cases, upon the second death, depending on the type of policy chosen.

Life insurance payouts are usually subject to inheritance tax (IHT) at 40%, as they are included in your estate.. Find out more about IHT Planning.

However, by placing your policy in a trust, the payout can be kept separate from your estate, reducing or eliminating tax liability. Speak with an adviser to ensure your policy is set up correctly for tax efficiency.

Yes, Whole of Life insurance is available for those over 50. While premiums generally increase with age, many insurers offer competitive rates for older applicants. An adviser can help you find the best deal based on your circumstances.

Some Whole of Life policies include critical illness cover, which provides a payout if you’re diagnosed with specific medical conditions during your lifetime. This can offer additional financial security in case of serious illness.

Yes, diabetics can qualify for Whole of Life insurance, though premiums may be higher. However, Broadbench advisers specialise in finding affordable policies for individuals with diabetes. If you’re diagnosed after taking out your policy, your original premiums will typically remain unchanged.

It’s not a nice thing to think about, but if you’re a contractor and you pass away, how would your loved ones survive? This is where Life Insurance can provide the answer. It pays out a large one-off sum to help your family live after you’ve gone.

No. There’s no cash value at any time. At the end of your Life Insurance policy term, you stop making payments and your cover ends.

If you have an interest-only mortgage, your outstanding mortgage loan stays the same until you repay it at the end of the mortgage term. Level Life Insurance could cover this type of mortgage.

It provides your loved ones with a large tax-free, one-off payment, or monthly payments if you pass away. It can be used to pay the mortgage off or help your family with living expenses. Monthly payments are tax-deductible if you are a limited company – look at Relevant Life Insurance. You are covered only for the duration (term) of the policy and cover only lasts while you keep up monthly premiums. Monthly payments can be reduced by combining this with a Critical Illness policy.

If the unexpected happens, you’d want your family to be taken care of. You’d want the mortgage paid off and enough money for them to live. It’s important to get this right, which is why we work closely with you, making sure the cover fits your needs but is also affordable for you. The policies we recommend are handpicked for business owners, professionals and contractors, and we’ll cut through any jargon, so you know exactly where you stand.

If you choose level or decreasing cover, your monthly payments are guaranteed to stay the same for the duration of your policy.

For decreasing Life Insurance, premiums are set at the start of the policy to consider the decreasing amount of cover you’ll need during the policy term. Premiums for decreasing cover are often cheaper than other types of life insurance.

With level cover, if you choose to help protect your payments from the effects of inflation, so the lump sum won’t be worth less in the future, your monthly payments may rise.

With index-linked cover life insurance, your death benefit increases over the life of the policy. This type of insurance can provide extra protection as the years go by to cover growing expenses, like a new house or bigger family, or protect your death benefit from inflation. The advantage of increasing/ index linked cover term insurance is that you don’t have to predict inflation – the policy will do this for you, but at a cost. Also, your increases are automatic and won’t be hindered if your health changes.

If you have a mortgage, you might want to take out Life Insurance. Then, if you die before your policy ends, the lump sum can be used to help pay off the outstanding mortgage balance, so your family could stay in their home. Some lenders will ask you to take out Life Insurance as part of their mortgage offer.

No, you don’t have to take out decreasing Life Insurance to cover a mortgage. The reason for the policy depends on a few factors, such as what you want the lump sum to cover, and how much you want to pay each month. We will advise you on the different levels of cover to suit different needs, so you can choose which one is right for you and your family.

No one likes being ill but, when you’re a business owner, professional or contractor and your income relies on your ability to work, it’s vital you get back on your feet as soon as possible. A Private Healthcare plan means that you and your family can have access to the best health facilities, without the wait times, so you can protect yourselves from any health issues (and subsequent financial strain) that might come your way.

Private Healthcare plans are typically designed to cover acute medical conditions. This includes short-term illnesses, treatable diseases and injuries which, through care, you are likely to make a full recovery from. If you have an existing chronic condition, it’s likely that this will be excluded from any cover you take.

Unlike other forms of insurance, Private Healthcare tends to be viewed as optional. This is because we are fortunate to live in a country that offers an extensive National Health Service that will cover most treatments for free. However, due to long waiting lists and lack of choice, it could also benefit contractors to have Private Healthcare in place.

As a business owner, professional or contractor, if you can’t work, you can’t earn. With a Private Healthcare policy, you can rest assured that if you do have an illness or injury, you’ll be able to get back on your feet and back to work faster than usual.

Private Healthcare is designed to cover conditions that you may develop after taking out the policy. However, depending on the insurer, you may be able to cover pre-existing medical conditions. Keep in mind that this will have an impact on the cost of your premiums.

Getting help faster – Being seen quickly is one of the many reasons contractors consider Private Healthcare. If you’re unable to earn due to an illness or injury, Private Healthcare will get you back on your feet faster than regular NHS services. You may have access to better care as well as medication and treatments that are not yet available on the NHS.

Privacy and choice – By purchasing Private Healthcare you often have more choice and greater privacy. You may be able to choose a hospital or doctor and even request your own private room – this wouldn’t be available to you if you used the NHS.

There are many factors that can influence the cost of your premiums. Typically, your age, current health and medical history, but your job may also have an impact if it is seen as a risky profession. If you’re a smoker you may have higher premiums than non-smokers.

When looking to get a Private Healthcare policy, it’s important for you to understand what type of cover you require. Do you want comprehensive coverage (which will cover you for everything) or a policy that simply covers you for outpatient visits?

You may also need to consider what could be affecting the price of your premium. Getting the best possible cover won’t be the cheapest but you can’t put a price on your well-being when you’re a contractor. Therefore, it is best to speak to an adviser to find out the level of cover you need to suit you and your circumstances.

When it comes to things as important as protecting our health and finances, we believe that you should receive the best impartial advice. To set up a Private Healthcare policy, or if you have more questions and want to speak to an expert, get in touch.

Critical Illness cover (also known as Critical Illness Insurance) is a medium to long-term policy which covers you for a serious illness during the policy period so you don’t have to worry about your finances.

If you are diagnosed with a serious illness, a Critical Illness policy will pay out a tax-free, one-off payment (some insurers may offer monthly instalment options also). This can help you pay for your mortgage or rent, and any existing debts you may have or help you to make adjustments to your home, such as a wheelchair ramp if you need it.

When you work for yourself, you no longer receive the same benefits as regular employees. These benefits include payment to cover a long period off work due to sickness. The alternative to receiving ‘sick pay’ is to receive state benefits, however, this may not be enough to replace your income.

If you’re eligible, you may be able to receive Employment and Support Allowance (ESA) – which ranges from £70 to just over £100 a week, depending on your circumstances and the seriousness of your illness or disability. Will that be enough to cover your household bills and family’s lifestyle? If not, then you should consider Critical Illness cover.

Each insurer has its own list of critical illnesses that they cover. Typically, you’ll be insured for heart attacks, cancer (depending on the type and the stage), strokes and permanent disabilities due to an illness or injury. If you have a specific illness that you want to be covered for, get in touch with a Broadbench adviser who will be able to guide you to the right insurer.

There are a number of factors that can influence the cost of your monthly premium including:

• Your age
• The level of cover you wish to take out
• Whether you’re a smoker or have previously smoked
• Your current health, weight and family’s medical history
• Your job (some occupations carry higher levels of risk than other professions and therefore may increase the monthly premiums)

Firstly, to keep a roof over your family’s head. With Critical Illness Cover, you can rest assured that you will be able to keep up with mortgage repayments or even pay off the full remaining amount. You’ll receive a tax-free pay-out – If you are diagnosed with a Critical Illness, the money you and your family receive is tax-free. Lastly, it gives you peace of mind – No one knows what the future has in store but with Critical Illness Cover, you will be protected for a number of illnesses. This way you can rest assured that you and your family are financially secure.

You may be able to get small multiple payouts. Most policies will only pay out once, but some insurers will make a small payment if you are diagnosed with a less severe illness. In this case, your policy would continue, and you should be able to make a further claim down the line if you’re diagnosed with a more critical illness.

To claim on a Critical Illness policy, you must be diagnosed with a medical condition that meets one of the definitions on the policy. In contrast, to make a claim on an Income Protection policy simply relies upon you being unfit for work, no specific medical condition is needed – therefore the pay-out is to cover you until you’re fit to return to work.

When it comes to things as important as protecting our health or finances, we believe that you should receive the best advice. To set up a Critical Illness policy, or if you have more questions and want to speak to an expert, get in touch.

Income Protection is an insurance policy that pays you a regular wage if you’re unable to work due to illness or injury. It will continue to pay you a salary until you’re ready to return to work, retire or if you pass away (dependent on the level of benefit taken).

You are covered for most injuries or illnesses, unlike other protection policies. The criteria for a claim within an Income Protection policy is not based on the illness/injury itself but on whether it has stopped you from working.

No. This is a common misconception of Income Protection; it only covers you when you are unable to work due to illness or injury. It does not cover gaps in between employment. If you’re looking for unemployment payment, you will have to apply for JSA.

As a contractor, you can typically ensure between 50% – 80% of your salary and dividends.

Your age, health, line of work and if you have smoked in the last 12 months can have an impact on your monthly premium. Therefore, it’s important to speak to an Income Protection expert to get a rough idea of what cover you can expect and at what cost before applying.

When you work for yourself, you do not have the financial support of an employer. This means that if you fall ill and are unable to work for a period of time, you do not benefit from sick pay. If this happens, how will you meet your living costs? It’s important to have an Income Protection policy in place so you can meet your living costs (mortgage, bills, food, lifestyle etc) in the unfortunate circumstance of illness or injury.

The deferred period is the time between you being unable to work and your payouts beginning. Typically, the longer the deferred period the lower your monthly premiums. To work out the length of your deferred period, you should consider how much you need per month to cover your bills and day-to-day living costs and offset this against your savings. From this, you can work out how long your savings will keep you afloat before you’ll need the financial support a policy delivers.

If your new contract pays more or less than the previous contract (or the contract you were on when you started the policy), you can contact your insurer to increase or decrease the amount of coverage you need.

Remortgaging is the process of switching your existing mortgage product to a new mortgage product, either with your existing lender or a new lender.

If you’re currently on a fixed rate mortgage, it means for a period of time (typically between 2-5 years) the interest you pay and the monthly repayment will be fixed. Once your fixed mortgage deal comes to an end, you will be placed on the ‘Standard Variable Rate’ (SVR). Each lender sets their own SVR and it tends not to be as competitive as fixed-rate mortgages.

You will still be able to get a mortgage however, your existing lender might not be able to understand your income now you’re contracting. It’s important to speak to a specialist contractor mortgage adviser who works with the whole of market and will find a lender that can understand your income and make sure you’re getting the best mortgage product available.

It’s important to speak to a specialist mortgage adviser who works with the whole of market.

If you’re switching to a new lender, the documents you need to provide will be similar to when you applied for the first mortgage. This will include details of your current and previous contract (if applicable), 3 months’ bank statements and if you have less than 3 months remaining on your contract, they will require a contract extension.

There are some fees to be aware of when remortgaging, for example, some lenders have upfront product fees that can be added to the loan, usually about £1000. Lenders do offer a free legal and valuation service to help you switch. If you’re not sure whether you’d want to pay a product fee, a mortgage specialist can help you look through the options.

A great benefit of remortgaging is that it gives you an opportunity to borrow more money. This can be used to make home improvements such as building an extension or refurbishing the kitchen or bathroom. Make sure you speak to an expert mortgage adviser to help assess how much you can borrow based on your day rate.

This is where we can help. Scouring the market for the best mortgage product can be a long and difficult process and, unless you have the right expertise, you may not end up with the best deal for you. Our specialist mortgage advisers do all the leg work, working with contractor-friendly lenders, so you don’t have to. Speak to your Broadbench adviser and see how much you could save on your remortgage.

A Buy to Let mortgage is where you buy another property specifically as an investment with the intention of letting it out.

Normally a minimum of 25% deposit.

Not for your main residence, but if you have investment properties that were bought on a Buy to Let basis, these will be subject to Capital Gains Tax. Other taxes may also be levied, we recommend you speak with an accountant to establish your tax position.

Yes. Of course, there are factors that impact a contractor’s eligibility, but just by being self-employed, you should not expect to be turned down by a lender as long as they understand contractors and contracting. However, factors that would prevent anyone from securing a mortgage, such as a poor credit history or a bad payment record will apply just as much. to contractors as to employees.

Yes! As long as we can see you’ve got a history in the same line of work and in the same industry in which you are now contracting, there are lenders who accept new contractors.

A typical journey will look like this:

1. Welcome Call
   This is an introductory meeting. You’ll meet your Broadbench adviser: they’ll explain our services, our regulatory status and establish a basic understanding of your requirements.
2. Fact-find
   Your adviser will send you a fact-find document for you to complete. Once received, your adviser will schedule a Discovery Call.
3. Discovery and Recommendation Call
   We’ll confirm the details supplied in the fact-find, and discuss your mortgage options:  fixed/tracker, term, fees, and your budget. Your adviser will also advise you about life insurance products to protect the mortgage and your family’s lifestyle.Your adviser completes your mortgage recommendation and the KFI (Key Features Illustration) and then will advise you on the AIP process. You’ll both agree what are the next steps: house hunting or booking your mortgage.
4. AIP (Agreement In Principle)
   Your adviser will send you an invoice of £100 to create the AIP.  Once payment is received the AIP can be booked.
5. Documentation
   Then adviser will send you a checklist of all the documentation you need to supply to us. You’ll then be invoiced for the remaining £400.
6. Mortgage Offer
   Once all documents are received, we’ll certify that your mortgage is ready to be booked. Your adviser then books your mortgage. Once the mortgage offer is received, we’ll liaise with the lender on your behalf.
7. Mortgage Review
   You let us know your exchange and completion dates.
8. Mortgage Completion
   We’ll let you know as soon as your mortgage completes and then schedule regular reviews during the mortgage term to ensure that the product remains the most suitable for you.

By all means, go to a high street lender to satisfy your curiosity, but in most cases, the lender will have issues with how income reaches the contractor. High street lenders understand dividends, but business owners, professionals and contractors who are tax efficient and only draw down a minimum salary and dividends to meet their needs won’t look good. Specialist brokers like us go to the same lenders you see in the high street but at the head office underwriter level. This means they are speaking to people with a bigger lending mandate and a knowledge of this sector contractors, and they use the contract to define a contractor’s income.

By all means, go to a high street lender to satisfy your curiosity, but in most cases, the lender will have issues with how income reaches the contractor. High street lenders understand dividends, but business owners, professionals and contractors who are tax efficient and only draw down a minimum salary and dividends to meet their needs won’t look good. Specialist brokers like us go to the same lenders you see in the high street but at the head office underwriter level. This means they are speaking to people with a bigger lending mandate and a knowledge of this sector contractors, and they use the contract to define a contractor’s income.

Lenders who specialise in mortgages for those earning a day rate typically assess the amount that can be borrowed on the annualised contract value. Each client is evaluated on the basis of their personal circumstances, generally, they can borrow a multiple of their annualised contract value.

However, they need to be in a contract at the time of the application and must be able to demonstrate continuity. A contractor applying with their first contract can get a mortgage as long as they have had continuity of employment before approaching the broker.

This is where a contractor specialist financial adviser differs from most brokers. There is a two-stage process. The first stage is the pre-approval, and the second stage is the full application.

In stage one, the lender requests documents from the business owner, professional or contractor such as current and previously signed contracts, three months’ personal and business bank statements, ID and proof of address. The lender will also complete a hard credit search at the point of application. After reviewing all documents and credit score, the lender will approve or decline the application.

Stage two is the full application stage. If the application has been approved the valuation will then be instructed, and if the valuation is satisfactory, the mortgage will go to offer. In some examples, the mortgage loan amount may be reduced following an underwriting review or the mortgage can be declined. Your broker would then agree with you on how you wish to proceed.

Brokers do have options for contractors who have a poor credit history and need specialist contractor underwriting for their mortgage. They will need to present a relatively positive picture of the client’s current circumstances and as long as the credit issues are historic and there has not been an issue within the last two years, but can usually find an option.

There are lenders who don’t do credit scoring but just complete credit checks. Financial advisers like Broadbench, with unrestricted access to the market and who are not restricted to just a handful of lenders, should be able to find a solution. However, the contractor will pay a premium with an elevated interest rate as a result of their poor credit history.

If a contractor has any plans to buy a property or refinance it is important that they talk to a specialist contractor financial adviser as early as possible, even if their plans are 12 months away.

That way the broker can find out early if there are any challenges and we can overcome them in plenty of time for the contractor to secure their mortgage when they need it.

It depends on the lender; however, most will ask for your current contract, your previous contract (if applicable), a contract extension (if you have less than 3 months remaining on your contract) and 3 months of business bank statements.

The lenders take your day rate or hourly rate and times this by how many days/hours a week you work and times that by 46 or 48 weeks a year (lender dependent). This is then deemed your annual salary.

From crime to community, amenities to areas of green space. Good questions to ask include:  where is the nearest supermarket or is the corner shop within walking distance or will you have to drive? Where’s the closest bus stop or train station? How are the local schools rated by Ofsted?

The main things that dictate how much a person or couple can borrow is income and current credit commitments.  All lenders have different ways to calculate what someone can borrow.

You will need a minimum of a 5% deposit.  The more deposit you put in, the better the interest rates will be.  For example, if you put in a 15% deposit this will get you a better interest rate than a 10% deposit.

A repayment mortgage is guaranteed to pay off your mortgage by the end of the term as long as all payments have been made.

An interest-only mortgage is where your monthly payments are only covering the cost of the interest and your loan amount will remain the same.  At the end of the term, you would either need to sell the property to repay the mortgage or find another source to repay the loan.

As a minimum, the building itself needs to be insured.  We would usually recommend that you also insure the contents within your home too.  Other insurances we recommend are Life Insurance to repay the mortgage debt if someone passes away and Income Protection insurance which provides you with an income should you be unable to work due to sickness or accident.

Yes. You can “remortgage” to another lender to take advantage of their better interest rates.  As part of our service, we will contact you as you approach the final few months of your existing mortgage deal to provide you with details of the options available to you.

Yes. Of course, there are factors that impact a contractor’s eligibility, but just by being self-employed, you should not expect to be turned down by a lender as long as they understand contractors and contracting. However, factors that would prevent anyone from securing a mortgage, such as a poor credit history or a bad payment record will apply just as much. to contractors as to employees.

The main things that dictate how much a person or couple can borrow is income and current credit commitments.  All lenders have different ways to calculate what someone can borrow.

You will need a minimum of a 5% deposit.  The more deposit you put in, the better the interest rates will be.  For example, if you put in a 15% deposit this will get you a better interest rate than a 10% deposit.

This will vary depending on the loan amount, the term of the mortgage and the interest rate.

A repayment mortgage is guaranteed to pay off your mortgage by the end of the term as long as all payments have been made.

An interest-only mortgage is where your monthly payments are only covering the cost of the interest and your loan amount will remain the same.  At the end of the term, you would either need to sell the property to repay the mortgage or find another source to repay the loan.

As a minimum, the building itself needs to be insured.  We would usually recommend that you also insure the contents within your home too.  Other insurances we recommend are life insurance to repay the mortgage debt if someone passes away and income protection insurance which provides you with an income should you be unable to work due to sickness or accident.

Yes.  You can “remortgage” to another lender to take advantage of their better interest rates.  As part of our service, we will contact you as you approach the final few months of your existing mortgage deal to provide you with details of the options available to you.

There are various costs associated with buying a property which we’ve detailed below:

• Stamp Duty Land Tax (SDLT): currently first-time buyers are not required to pay SDLT.  Current percentages payable can be found here.
• Solicitor’s fees: These are based on the purchase price.  Typically, First Time Buyers will pay £1000-£2000.
• Valuation fees: For most lenders, these are also based on the purchase price.  Many lenders offer free valuations, especially for first-time buyers and remortgages.
• Lender’s arrangement fees: These can usually be either added to the mortgage or paid upfront and average at about £999.00.
• Mortgage broker fees: We charge competitive broker fees to our clients of £100 for an agreement in principle and £400 on application.

Yes, however, you could have early repayment charges to pay if you have only had your mortgage product for a short amount of time.

Buying a home is the biggest financial decision most of us make, so it’s important to go slow and ask the right questions when looking around a property. Small mistakes can have a large price.

There’s nothing worse than trying to leave for work in the morning and not being able to get out of the driveway because of the road traffic. If you have time, check out what the area around the house is like around rush hour. Even if the house isn’t directly on a main road, it could be used as a shortcut or where people park to get to work or school.

These people could be the faces you see every day for the next few years. It’s important to have a good idea of what they are like and how the current homeowners have got on with them. Obviously, everyone is different, but having a sense of who shares your fence is not a bad idea. Are they having any work done to their home? Are they typically noisy? Can you trust them to sign for missed deliveries?

From crime to community, amenities to areas of green space. Good questions to ask include:  where is the nearest supermarket or is the corner shop within walking distance or will you have to drive? Where’s the closest bus stop or train station? How are the local schools rated by Ofsted?

The attic is often ignored when it comes to viewing a house, so make sure you don’t miss it off your list when you look around or ask questions. Things to consider when it comes to the attic include how much storage space is available, whether there is a possibility to convert it into another bedroom, is there insulation. The latter can make a big difference to your heating bills.

Replacing a roof is an expensive task and could cost you £5,000+. Though most new roofs have a life expectancy of 20-25 years, it depends on what materials have been used. Because of this, make sure you speak to the estate agent or surveyor about the structure of the roof – you could face a big cost if it isn’t in good condition and needs work.

Have you ever wondered why your home is unusually cold in the winter and scorching hot in the summer? It’s due to the direction of the house. It may seem silly, but the direction of a house can impact the feel of a home, so if you value a BBQ in the summer, it may be in your interest to find a home with a south-facing garden so you can best enjoy the sunshine.

Buying a house is one thing but the cost of living in it could be a deal breaker. Get an idea of how much this monthly cost could be and whether you will be able to afford it in addition to your monthly mortgage payments and other regular outgoings. Helpfully, some property search sites do highlight the average energy and water costs – so make sure you use this in addition to asking the estate agent or current owner.