A million people a year are unable to work due to illness or injury. And how do you pay the bills if you are made redundant?

In this, the third of my articles on the different types of insurance products available, I explain how you can protect yourself against the hardship that comes with being poorly, or losing your job.

Income protection insurance

Income protection insurance is a policy you can take out to cover your income if that happens to you if you can’t work because of illness or an accident. It’s a long-term policy which pays out up to approximately 65% of your gross income. The policy runs until you die, retire or the policy comes to an end. If you make a claim the benefit will be paid out monthly. You can usually make multiple claims against income protection policies.

Accident, sickness & unemployment insurance

This is similar to Income Protection in that it pays out an agreed monthly amount if you can’t work through accident or sickness as well as covering you if you get made redundant. However, this is a short-term policy which pays out for up to 24 months. The idea is that it can cover your monthly expenditure, including your mortgage payments and, in the case of redundancy, means you don’t have to rush into the first job that comes along, giving you up to 24 months to find a suitable job, knowing your monthly expenditure is covered. Again, you can make multiple claims.

IMPORTANT

Many people think they won’t need income protection or accident and sickness cover because their employer or the government will give them sick pay. In some cases this might be right, but in many others you might not be able to get by, particularly if you are off work for a long time. State benefits, for example, pay just £80 to £100 a week. Have a think about your bills and how you would manage with a much lower income…

Contact me for a free, no obligation chat about any insurance or mortgage need you might have on 07767 692653.