29 January 2014

Posted by Discount Insurance on Wednesday, January 29, 2014
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Income Protection (IP) is an insurance policy that pays out if you’re unable to work due to injury or illness. It was formerly more commonly known as permanent health insurance (PHI).

Millions of people in the UK have policies such as private medical insurance and payment protection insurance, sold to them by persuasive sales people who convinced them they needed protecting. However, the most underrated protection policy - that many fail to consider - is income protection.

Do I need IP?

You need to ask yourself – would my family and I be able to live without the regular income you receive from working? If the answer is no, then you definitely need to consider income protection. Ill health or redundancy can happen at any time, to the best of us, so it is important you are prepared.    

According to research, just 12% of employers support their staff for more than a year if they’re off sick from work. Combine this with the relatively low level of state benefit available in the UK and everyone of working age should consider IP.
It is thought that just 9% of UK workers have any form of IP, compared with 41% who have life insurance and 16% who have private medical insurance.

How much does Income Protection pay out?

Our policy can cover up to 65% of your gross salary for up to a whole year (at a maximum of £3000 per month).

As well as the full cover options, we also offer unemployement only and accident & sickness only options. What’s more, we can cover a vast range of occupations and don’t discriminate against manual professions.   

‘Back to day one’ cover is also available, meaning you’ll receive you first payment on Day 31.  We’ll also cover you if you have to give up work to become a full-time carer for a member of your immediate family.

Isn’t the income protection the one with all the bad press?

No – that was PPI! Let's be clear - income protection isn't the same thing as the famously mis-sold payment protection insurance (PPI).  

PPI covers a particular debt, with any payouts going directly to the lender, income protection on the other hand gives you a tax-free percentage of your income if you’re unable to work.

Am I eligible for Income Protection?

  • To be eligible for IP:
  • You must be a UK resident and between 18 and 64 years of age.
  • You must be self-employed or working for a UK-registered company and assigned to work within the European Union (working for 16 hours per week or more).
  • You must be working for 6 consecutive months before the policy start date.
  • If self-employed, you must be trading for at least 6 months before the policy start date.
  • You must not be aware of any impending unemployment or company restructure.
  • Any pre-existing medical conditions (from the past 12 months) are excluded.

How much does Income Protection cost?

Our highly-competitive premiums are based on your individual circumstances, call 0800 294 4522 or visit www.discountinsurance.co.uk/other-products/income-protection/ for more information or a quick quote today!