Home/Personal protection/Income Protection
Personal protectionYour income, if you cannot work.
Income protection replaces part of your earnings each month if illness or injury stops you working. It is the cover most people are missing entirely, and the one most likely to actually pay out.
The three decisions
Income protection is more configurable than most cover. These three choices between them set both what you pay and what you get.
- What it pays
- A monthly income
- When
- After your chosen deferred period
- How much
- Typically 50% to 65% of gross earnings
- Until
- You return to work, or the term ends
The deferred period
How long you wait before it starts paying. Line it up with the end of your employer's sick pay. A longer wait means a noticeably lower premium.
The benefit amount
Insurers cap it at a proportion of your gross income, commonly between half and two thirds, so that going back to work is always worth more than claiming.
Own occupation
The definition that matters. Own occupation pays if you cannot do your job. Weaker definitions only pay if you cannot do any job at all, and are much harder to claim on.
How we arrange it
Find out what your employer actually pays
Company sick pay varies from nothing to six months at full pay. It sets your deferred period, so we start here.
Set the benefit and the deferred period
The two levers that move the price. We will show you what a few combinations cost rather than presenting one number.
Insist on own occupation where we can get it
It is available for most occupations and it is the difference between a policy that pays and one that argues.
Choose short term or full term
Some policies pay for a maximum of one or two years per claim, others until you recover or reach retirement. The second costs more and covers the thing you actually fear.
Income Protection, answered
- How much of my income can I cover? Usually somewhere between 50% and 65% of gross earnings, and the benefit is normally paid tax free. The cap exists so that claiming is never better paid than working.
- What is a deferred period? The waiting time between being unable to work and the policy starting to pay. Common choices are 4, 8, 13, 26 or 52 weeks. Match it to your sick pay and your savings.
- Does it cover redundancy? No. Income protection covers illness and injury. Redundancy cover is a separate and much more limited product.
- What if I am self-employed? It matters more, because there is no sick pay behind you. Insurers assess your income from accounts or tax calculations rather than a payslip.
- Will it affect my benefits? It can affect means-tested benefits. If that is a concern, tell us and we will factor it into the amount we recommend.
It pays a regular income rather than a lump sum, which is what a household budget actually runs on.
Most people insure the house and the car and not the income that pays for both. This is the one we most often find missing.
Request assistancePeople asking about this usually ask about these
Ask us about income protection
Tell us where you are up to and an adviser will come back to you. The answers below just save us a phone call working it out.
- One of the five advisers on Eastfield Road, not a call centre.
- Usually the same working day.
- No obligation, and nothing to sign at the end of it.
Would rather talk now? Call 01733 602 033.
How long could you manage?
If the answer is a couple of months, this is worth twenty minutes of your time.