Income protection.
Income protection is designed to provide a regular income if illness or injury prevents the insured person from working and they meet the policy’s definition of incapacity.
INCOME PROTECTION
What is income protection?
Rather than providing a single lump sum, income protection typically pays a monthly benefit after an agreed waiting period, known as the deferred period.
The amount payable is generally linked to a proportion of eligible earnings and is subject to the insurer’s limits and policy conditions.
INCOME PROTECTION
How it could help
Many people rely on their monthly income to meet essential financial commitments. These may include mortgage payments, rent, utility bills, childcare, food and other household expenses. If an illness or injury prevents you from working, income protection could help replace part of your lost earnings following a successful claim.
For example, a self-employed business owner who is unable to work due to an illness may not have access to the same sick-pay arrangements as some employed individuals.
An appropriate income protection policy could provide regular payments during a qualifying period of incapacity.
INCOME PROTECTION
Important considerations
Income protection does not normally replace your entire salary.
Payments generally begin only after the selected deferred period, and the duration of payments depends on the policy.
Insurers also apply definitions of incapacity, eligibility requirements, exclusions and other conditions.
Some policies offer shorter payment periods, while others may provide benefits for longer periods, potentially until a selected retirement age.
Income protection is not the same as unemployment insurance and does not ordinarily cover redundancy or unemployment unrelated to illness or injury.
Important information about protection insurance
Protection policies are subject to eligibility, underwriting, policy terms, conditions and exclusions. The benefits available, premiums payable and circumstances in which a claim may be accepted vary between providers and products.
Failure to maintain required premiums may result in the loss of cover. Claims are not guaranteed and must meet the conditions of the relevant policy.
Our advisers can explain the relevant features, benefits, limitations and costs to help you consider suitable protection arrangements.
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Talk to an adviser about the protection that fits your circumstances.