Protection for your income

Don’t you? Income is the thing that keeps us ticking over, making sure essential outgoings are taken care of. And if you’re lucky it lets us do what we enjoy, whether that’s trips to the cinema, dinner with a friend or a treat for the kids. If you didn’t have a payday for a few months, have a quick think about how you would keep paying for life’s little luxuries on top of day-to-day expenses.

There are some topics in life we all like to stick our heads in the sand about. And thinking about the worst case scenario with our health is definitely one of them. But here’s the thing – life happens and really, it’s better if you’re prepared for it. Most claims on our income protection were for things like back pain, tendonitis, and herniated discs¹ – they’re one of the main reasons people are in pain and taking time off work².

We hear you. The price of everything is going up these days. But actually income protection might not be as pricey as you think. There are different options you can choose, which make it cheaper or more expensive – it’s up to you. Sit down and have a chat with a financial adviser to see what might work for your budget. If you do end up needing it, it could be the best money you’ve ever spent.

It’s time for some tough love from us. Almost a quarter of us have no savings and 50% of us have £1,000 or less in savings³. How would you survive with no money coming in? Plus, wouldn’t you rather use those savings on a nice holiday? Also, the maths doesn’t add up when you look at a household’s average weekly outgoings (£628⁴) against what statutory sick pay gives you (£109.40⁵).

Ok there, we said it. So let’s make sure you’re taken care of before you ever get to that point. Have a chat with an adviser about whether income protection’s the insurance for you.

This is a definite myth to bust. In 2022, our industry (that’s life insurance in the UK) paid out record-breaking amounts of money – we’re talking in the billions. With 98% of claims being paid⁶. Occasionally insurers can’t pay out. The main reason is because we sometimes don’t get the full story when people set up their insurance⁶. So if we have all the details at the start, there’s no reason your claims won’t be paid, helping you get back to your best.

To put it simply the two kinds of policies apply to very different situations and cover different illnesses. The pay outs are also designed to do different things. In a nutshell, critical illness gives you a single lump sum of money if you’re diagnosed, or have surgery for, a specified potentially life-threatening illness.

Income protection gives you a percentage of your salary as a regular payment if you can’t work due to illness or injury. Income protection covers most medical conditions. Unlike critical illness there is no ‘list’ of insured illnesses and so it tends not to matter what the illness or condition is. The important factor is simply whether or not you can work.

There may be some cross over where the same condition could lead to a successful claim on both policies. Another way to look at it is one looks after those big one off expenses or debts and one tackles the monthly bills that never go away while you’re off work and recovering.