Kilkeel Credit Union also offers all eligible members insurance services. Some of these insurance services are paid for directly by the credit union and others are paid directly by the member. The insurance cover currently provided for by Kilkeel Credit Union in respect of eligible members is:
- Loan Protection and Life Savings Insurance
- Death Benefit Insurance
Death Benefit Insurance is deducted from eligible members’ dividend. If the dividend does not cover this the member can pay in the office.
Life Savings Protection
Life Savings Protection is the life insurance cover provided to Kilkeel Credit Union members as a member benefit i.e. at no direct cost to the member and as an incentive to save regularly. Life Savings Insurance is payable on the death of the eligible member, subject to policy terms and conditions.
The amount of insurance benefit to which a member is entitled is in proportion to the amount of savings the member has made during the term of membership, and depends on the member’s age at date of lodgement.
Amounts saved after the 70th birthday are not insured. However, cover built up before the 70th birthday remains in force after the 70th birthday as long as the savings are left in the credit union.
Withdrawals may affect the amount of insurance payable in the event of a claim.
The following example illustrates how Life Savings Benefit is calculated
Tom died at age 72. He made no withdrawals from his shares after age 55. His balance was £3,000 at age 55; £3,800 at age 60; £5,200 at age 70 and £5,600 when he died.
|(1)||55||£3,000||Share balance on 55th birthday or lowest balance thereafter||(1) @ 100%||£3,000|
|(2)||60||£3,800||Share balance on 60th birthday or lowest balance thereafter||(2) – (1) @ 75%||£600|
|(3)||65||£4,400||Share balance on 65th birthday or lowest balance thereafter||(3) – (2) @ 50%||£300|
|(4)||70||£5,200||Share balance on 70th birthday or lowest balance thereafter||(4) – (3) @ 25%||£200|
Total Shares: £5,200 LS Benefit Due: £4,100
Withdrawals of Shares has a negative impact on Life Savings Insurance as the claim is based on the lowest share amount after the age of 55.
|Tom died at age 72. His balance was £3,000 at age 55; £3,800 at age 60; he made a withdrawal at age 64 reducing his balance to £1,200. At age 65 he had £2,200 in shares and £2,800 at age 70. His balance was £3,200 when he died.
Total Shares: £2,800 LS Benefit Due: £1,850