Planning beyond the usual eighteen or twenty-one
Most family cover runs until the youngest child leaves school or university. If your child is likely to need support for life, that end date does not fit. You might want cover that pays out whenever you die, or a term that runs well into your old age.
Whole of life cover costs more but guarantees a payout for your child at some point. Some parents combine it with term cover for the mortgage, so the two policies share the load.
Think about what the money would pay for. It might fund extra support hours, adaptations to a home, holidays, therapies or a place in supported living. Discuss these with your child's support team, who may know what costs to expect.
Keeping benefits intact
Many disabled adults receive benefits that take savings into account. A payout left to your child directly could push their savings over the limit and stop support they rely on.
A discretionary trust or a trust that qualifies as a disabled person's trust lets trustees hold the money and spend it on your child's behalf. Special rules can apply to the tax treatment of these trusts. Speak to a solicitor who works with families of disabled children before you choose.
Review the trust as your child grows and benefits rules change. A trust set up when your child is small should still work when they are an adult, but a quick check every few years does no harm.
Choosing trustees and writing down what you know
Trustees will make decisions about your child's money for many years, perhaps decades. Choose people who understand your child and will stay involved. Some parents add a professional trustee alongside a family member.
Write a letter of wishes and a care plan covering routines, communication, health needs and the people your child trusts. That knowledge is often the hardest thing to replace.
- Daily routines and what helps on difficult days
- Medical teams, therapists and school or day service contacts
- Benefits your child receives and when they are reviewed
- Your hopes for where and how your child will live
Your own income and health
Many parents of disabled children work fewer hours or have left paid work to provide care. If one parent still earns, income protection on that salary is worth considering, because the family may have little slack if it stopped.
Critical illness cover can give the family a lump sum if either parent is diagnosed with a serious illness, helping pay for extra support during treatment.
If your child receives benefits now, ask whether their eligibility might change at 16 or 18. Knowing how support could shift at adulthood helps you decide what extra money your trust may need to provide.
How Hi Tomorrow helps parents of disabled children
We take time to understand your child's needs and how long support may be required. Then we suggest a mix of cover from our panel, explain the trade-off between term and whole of life, and point you towards specialist legal advice on the right trust.
We can book calls around therapy appointments and school runs.