Income Protection Insurance

Is an insurance that protects a percentage of your income should you be unable to work due to sickness. This usually compliments any employer benefits you have and is set up to start as your employer benefits end and normally continue to pay until you retire.

If you're unable to work because of illness or injury, Income Protection Insurance is designed to provide you with a regular tax-free monthly income.

The maximum amount of income you can replace through insurance is broadly the after-tax earnings you have lost, less an adjustment for state benefits you can claim. As with all insurance, it is important that you have a policy that provides the cover that suits your individual needs.

Long-term income repayment policies usually come into play between the time when your employer stops paying sick pay and when you collect your pension.

Shorter-term policies tend to be used to protect a mortgage, bank loan or other payment. These usually commence within a few weeks but stop entirely after 12 months or 24 months. Short-term policies often include unemployment and redundancy, unlike longer-term income protection cover, which does not.

To clarify, Income Protection Insurance only applies to products that pay you an income if you become unable to work due to sickness or injury. 

We will happily explain this to you in more detail.