Income Protection Insurance
Income Protection insurance is a policy designed to pay a monthly amount to you directly to support you if you cannot work because you are ill or injured. They do not typically include cover for redundancy (however, there are other types of policies that can look at this).
It pays a percentage of your gross salary (or take-home pay). There are short term policies, also known as budget Income Protection, and long term policies, also known as full Income Protection.
Income Protection is the most basic insurance available and it’s one that is definitely essential, even if you are a house person. Income Protection ensures that you still receive an income if you are unable to work due to accident or sickness.
Although Income Protection is aimed to support you, they are not designed to make financial position better if you are not able to work. There are restrictions in place on how much cover you can have.
Do I Need Income Protection Insurance?
All providers differ on the following:
- Amount of cover available
- Pay-out/claim term
- Policy end age (which can often be dependent upon occupation)
- Reviewable or guaranteed premiums
- Additional benefits, if any
- Criteria to claim against (also often dependent upon occupation)
- Treatment of existing conditions and effect on premiums
- Deferment periods (depending on when sick pay from your employer ends or reduces)
Due to the complexity of these products, we always recommend you seek advice which is why you are not able to apply or receive a quote through our website for these policies.
Income Protection – the most crucial cover that you can purchase
Anybody who knows a thing or two about insurance will tell you that Income Protection is the most crucial cover that you can purchase. This is because you are more likely to be suddenly unable to work due to illness or injury than you are to die or diagnosed with a critical illness.
More useful income protection facts and resources
Did you know that every year in the UK around one million people can’t earn a wage because of a serious illness or injury? Well, Income protection insurance is available to cover people who are in this unfortunate predicament. Income protection insurance protects your income.
Imagine again for a minute if something similar should happen to you. Could you live and get by with sick pay from your job or from your own savings? Maybe you’re self-employed with little to no financial planning in place? If you’re concerned at this point you will need some solutions and you may want to think about getting Income Protection cover.
Permanent Health Insurance aka Income Protection Insurance
Designed for the short-term and the long-term this insurance policy will make sure that you continue to receive a regular income if you experience illness, sickness, disability or injury. It can also cover you in the event of your death or until the policy expires, whichever happens first.
When do insurance payouts start?
There can be a waiting period. It’s quite common to start receiving payouts after your sick pay ends or when your other insurances start to pay. The longer you can delay the less your monthly premiums will be. Keep up with your agreed monthly payments and you can claim as often as is required.
Income protection and critical illness – some differences
Critical illness insurance pays a one-time lump sum. Income protection can cover fewer illness and can also pay out a monthly sum related to your income (from 2 to 5 years).
Income Protection policy types:
- Indemnity benefit policy – you are covered for an amount which is a percentage (%) of your income when you file a claim. If your salary is less than when you first started the policy, your monthly insurance payment will be less. You will find that indemnity interest plans can be cheaper, which can be beneficial to securing income.
- Agreed Value Insurance – you are covered for an amount which is a percentage of the amount agreed when you first signed up for the insurance. Agreed Value is more expensive but if you have revenues that change annually it’s highly beneficial.
Why Income protection insurance is so important
Just one example: if you are self-employed or a small business owner you might not have any of your own cover or sick leave support / subsidies in place. The chances are that you have family members or dependents who rely on the income that you earn. Even when you can’t work, money to pay bills and your mortgage will have to come from somewhere. Make sure you put the right insurance in place.
Call Prime today to arrange a free no obligation consultation
Searching for the right insurance can be very time consuming and difficult to understand. Prime Financial Solutions and Mortgages Ltd is an established mortgage broker and Life Insurance broker based in the centre of Wigan, Greater Manchester. We are respected and recognised by the FCA and we can help you to find the best possible solutions in the shortest amount of time. Contact Prime 01942 665436 today to book a free consultation.
Mortgage Protection Insurance
Anybody who knows a thing or two about insurance will tell you that Income Protection is the most crucial cover that you can purchase. This is because you are more likely to be suddenly unable to work due to illness or injury than you are to die or diagnosed with a critical illness. So looking at ways to protect yourself and your mortgage are essential steps towards getting peace of mind.
To find out more you can contact us by email email@example.com and by phone 01942 665436 or you can use our quick contact form. You can visit us at Rodney House, King Street, Wigan WN1 1BT. If you would like to complete a quick online application for Life Insurance you can go straight here to get your free quote.