Compare income protection cover

Compare income protection cover
- Compare the market with our team of experts
- Choose from long-term, short-term and guaranteed policies
- Suitable for anyone earning a full-time wage
Income protection insurance provides financial support if you’re unable to work due to illness or injury or if you are made redundant. We’ve looked at what the policy includes, whether it can be taken out for the short or long term and how you can find the best cover for you.
If you find yourself unable to work due to an accident or illness, or if you lose your job through no fault of your own, income protection insurance pays you an agreed portion of your salary each month.
The money can be used to cover expenses, existing debts, bills and other costs. Income protection can be especially useful for those working in dangerous industries who want to make sure their crucial household expenses, like their mortgage, will always be covered.
Income protection only covers events beyond your control, so you’re much less likely to be covered if you’re fired from your job or if you injure yourself through engaging in risky hobbies or activities (outside of work duties).
Different types of income protection policies cover different aspects (see below), but all provide a monthly payout to help you cover things like household expenses, bills and other outgoings.
There are several main types of income protection insurance:
There are also options when it comes to your policy’s spec:
Income protection pays out a monthly sum of money, which is a portion of your usual salary. The amount is usually set by you at the beginning of the policy term.
You can choose for payments to start after your sick pay runs out or straight away. The payouts are tax free.
That depends on your circumstances and the benefits you have at your current job.
If you have a large amount of savings to fall back on, you might not need this cover. However, depending on how long you are out of work, you could run out of money at some point.
If your current employer offers a good redundancy package, this can be enough to cover your expenses until you find a new job. And, if your company offers good long-term sick pay, this can also be sufficient.
People who can rely on government benefits or have friends or family to support them may also not need this type of cover.
Income protection can still be useful to top up your income (as it will only cover an agreed portion of your salary, up to 70%), but it does require monthly payments, so it’s up to you to decide if you can rely on other benefits only. If you don’t have these other options, income protection insurance can be a real saving grace.
Income protection can be a long- or short-term policy.
Long-term unemployment protection usually only covers you if you’re unable to work due to illness or injury. It pays out a portion of your monthly salary until you can work again or until you retire, die or the policy ends.
Short-term income protection can cover illness and injury but also includes involuntary redundancy. This type of policy will only pay out for the limited time set out in the policy documents, usually up to 2 years.
The cost of insurance is always reliant on a number of personal factors. For income protection, these include details of both your job and the state of your health.
Things that can affect the cost of your cover include the following:
The best way to find the best value deal for you is to compare income protection insurance for your personal circumstances.
There are some types of insurance cover that you can take out instead of, or in addition to, income protection insurance:
If your company is impacted by an event beyond your control (such as the coronavirus pandemic) and you are made redundant as part of cuts to the company's expenses, income protection will kick in and pay you a monthly percentage of your old salary to help with household bills and expenses.
Even if you receive a redundancy package from your employer, income protection can top this up and give you more breathing space while you look for another job.
* This is a fictional, but realistic, example.
There are a few ways to lower your insurance premiums, including the following:
Even if you have other means of covering your expenses if you lose your job, having income protection in place can be very useful.
This is especially true if you have dependants to provide for or if you’re self-employed (as this means you won’t have sick pay).
To find the best deal for you, compare income protection insurance from different providers.
Learn what accident and sickness insurance means, what it includes and whether it’s worth taking out.
Find out how you can protect yourself financially in the event you lose your job with unemployment insurance.
In the event of being made redundant, insurance can provide financial protection. Find out what’s included in redundancy insurance.
If you find yourself unable to work, a loan protection insurance policy will pay out monthly benefits straight to your bank account.
Despite its questionable past, PPI can help protect you financially if you lose your income and are unable to make repayments on loans.