Income Protection Insurance

Helping you protect all the things you work hard for...

or call us on 0208 432 7333
 
Our Insurers - Aviva, LV, Friends Life, PruProtect, Ageas Bright Grey, Scottish Provident, Legal & General, Exeter Family Friendly
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Why Income Protection Insurance?

Income protection covers your monthly income should you suffer an accident, sickness or unemployment.

Designed to cover your core monthly financial commitments such as your mortgage/rent, bills and food.

Income Protection is the one protection policy every working adult should consider. Which? Money 2013

Speak to our expert independent advisers or get an instant online quote to compare the UK’s leading insurers.

What is it for?

What does Income Protection Cover?

Accident & Sickness
When the ‘Own Occupation’ definition of incapacity is used the policy can payout for any medical condition that prevents you from working in your own specific job role.

As income protection policies do not use a set list of conditions they cover and many insurers do not have any standard exclusions, income protection is the most comprehensive form of incapacity insurance available.

Unemployment
Some plans also have the option where the policy can payout should you suffer forced redundancy, or there are some policies that cover unemployment only.

What does it cover?

How does Income Insurance Work?

Stage 1:
You cease working and earning your income due to accident, sickness or forced unemployment.

Stage 2:
You make a claim with the insurer which may include completing a claims form, a GP Note and/or redundancy letter.

Stage 3:
The insurer starts paying out your chosen monthly benefit after your initial deferred period has been completed.

Stage 4:
Your policy will pay out a monthly benefit either until you return to work or reach the maximum payout length

How does it work?

Do I need Income Protection?

When deciding if income protection is worthwhile it makes sense to weigh up your risks and the potential consequences:

The Incapacity Risk:
1 in 10 people have been unable to work due to illness or injury for +6 months (The Guardian/Unum, 2011).

The Consequences:
With state incapacity benefit of only £99.15 per week, someone with a salary of £30,000 would suffer a 77% fall in income.

The Question:
If you lost your income how would you cover your monthly outgoings if you didn’t have any income protection?

Do I need cover?

Your Key Options

Choose your level of cover

Depending on the insurer, it is possible to cover anywhere from 50% to 70% of your gross (pre-tax) income.

Choose your deferred period

How long could you survive without an income before the policy pays out? The shortest deferred period is 7 days and the longest is a 12 months.

Choose your payout length

Short-term plans can payout for a maximum of 12 or 24 months and long-term plans can continue paying out a claim right up to your retirement age at the end of your working life.

What are my options?
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What is income protection?

We all insure our cars and homes however we often forget to protect what pays for it all, our earnings.

Income insurance is designed to protect up to 70% of your gross salary in both the short and long term should you be unable to work due to accident or sickness and in the case of short term protection, unemployment as well.

Given the level of government support available and with fewer employers offering long term sick pay above and beyond Statutory Sick Pay, a personal income protection policy is more important than ever.

Do I need it?

According to the Department for Work and Pensions (DWP) there were over 370,000 people claiming Employment and Support Allowance (ESA) for incapacity in August 2009.

With ESA standing at only £99.15 per week, permanent health insurance allows many individuals to maintain their standard of living should they lose their income due to sickness or injury. Since 2005, DWP figures also show that the average claim for incapacity benefit stands at nearly 3 years.

How does it work?

If you suffer sickness or injury that prevents you from working your income insurance plan will begin to pay a monthly benefit after your chosen deferred period either until the policy ends or you return to work.

It is possible to insure up to 65% of your gross (pre-tax) earnings for anything from 5 years to the normal retirement age with salary insurance deferred periods ranging from 1 month to 12 months.

Long term protection

Long term disability insurance is a well established and respected form of income insurance, which some insurers having offered this product for over 100 years, whereas payment protection a relatively new type of insurance cover.

This traditional policy type provides long-term earnings protection from the risk of sickness or injury, possibly paying out all the way until retirement.

Example
John, an IT consultant, has taken out a self employed income protection plan and suffered a type of cancer that kept him off work for just over 6 years while he received treatment and recovered.

After John’s chosen deferred period of 6 months, his permanent health policy acts as a sick pay insurance and paid him a monthly tax-free benefit of £790 each and every month for 6 years, totalling close to £57,000, representing 50% of his gross annual salary.

Short term protection

Designed to provides short-term earnings cover against the risk of accident, sickness and unemployment, with policies paying out for a maximum period of 24 months.

Short term policies do not tend to be as comprehensive as the traditional options which is highlight with their being no medical underwriting and reviewable premiums.

Example
Mike and Jenny, an engineer and nurse from London, took out a salary protection policy to cover their joint monthly mortgage payment of £1,000 plus an extra 25% for associated home costs.

They decided to split the benefit in a 50:50 ratio so that the policy would payout £625 if either of them were off work. After six months of taking out the policy Mike was made redundant which kept him out of work for 4 months.

With their chosen deferred period of 30 days (with no back to day one cover) the policy made its first payment of £625 on day 61 of their claim (having accumulated from day 31).

Over the 4 months the policy made 3 payments of £625 before Mike was able to return to work, totalling £1,875. Thus, via his loan protection insurance Mike was able to keep up with his share of the joint loan repayments whilst he was unemployed, plus a little extra for living costs.

Need further information?

If you would like to receive income protection quotes from a panel of leading UK insurers then click here, complete your details and wait 10 seconds for your quotes to load.

Alternatively, if you would like to talk through your options with one of our expert and impartial advisors then please feel free to contact us on 0208 432 7333.

  • As independent advisers our aim is simple, couple expert advice with a first class service.
  • We are wholly independent and compare all the leading UK insurers.
  • We use our buying power to find you the most competitive rates.
  • You are not a number in a queue getting pushed from pillar to post, speak to a named consultant with a direct phone line.

Raising Awareness of Income Protection Insurance

How much income are you putting at risk?
Your Current Age
Monthly Expenditure
 

Insurer Claims Statistics

 

When choosing our personal protection we want to know it is going to pay out when we need it to.

By choosing a product or specific insurer from the menu below you will be able to view the claims payout rates for all of the main UK insurers for income protection, life insurance and critical illness insurance.

Insurer
2012
Percentage of Successful Claims
2013
Percentage of Successful Claims
2014
Percentage of Successful Claims
Critical Illness Insurance
Aviva
92.5%
93%
93.2%
Legal & General
93%
92%
92.2%
Liverpool Victoria
91%
93%
88%
Zurich
90%
94%
91%
Friends Life
89%
91%
94%
Scottish Provident
93%
90%
94%
Aegon
91%
93%
93%
Bright Grey
91%
-
94%
Income Protection
British Friendly
97%
96%
96.7%
Exeter
95%
92%
94%
Cirencester Friendly
94%
-
94%
Aviva
93.5%
93%
93.2%
Legal & General
91%
95%
93.9%
Liverpool Victoria
88%
88%
85%
Zurich
90%
100%
93%
Friends Life
87%
85%
86%
Scottish Provident
86%
-
-
Aegon
83%
93%
92%
Bright Grey
83%
-
-
Life Insurance
Aviva
99%
99%
99%
Legal & General
-
98%
98.30%
Liverpool Victoria
99%
98%
98%
Zurich
-
98%
99.8%
Friends Life
-
99%
99%
Scottish Provident
98%
100%
-
Aegon
94%
94%
98%
Bright Grey
98%
-
-
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Actual Income Protection Claims

 

The table below details real life stories of how an income protection policy has saved someone financially following an illness which left them unable to work.

The information is from Liverpool Victoria's 2011 claims, it demonstrates how anyone can lose their income, regardless of age, gender or occupation, LV's youngest claimant in 2011 was just 22 years old.

Age at Claim
Gender
Occupation
Length of Claim
Cause of Claim
Last Monthly Benefit
Total Payout So Far
31
Male
Carpet Fitter
15 years
Brain damage from road traffic accident
£303.00
£55,449.00
43
Male
Accountant
7 years
Cyst removed from the Brain
£3,194.00
£255,520.00
46
Female
Veterinary Surgeon
12 years
Arthritis
£369.00
£51,291.00
48
Male
Estate Agent
14 years
Heart Attack
£4,883.00
£805,695.00
48
Male
Doctor
1 year
Depression
£3,357.00
£53,712.00
49
Male
Physiotherapist
3 years
Depression
£1,942.00
£73,796.00
48
Male
Quantity Surveyor
7 years
Stroke
£2,528.00
£207,296.00
51
Female
Marketing Consultant
2 years
Breast Cancer
£2,434.00
£48,680.00
59
Male
Solicitor
1 year
Parkinson's Disease
£2,156.00
£26,452.00
Source: http://www.lv.com/upload/IFA-Rebrand-2009/pdf/2012/aug/212248312PMFPPAPIPclaimsSummary.pdf

Income Riskometer

Welcome to the Drewberry Income Riskometer! Simply answer the questions below and the Riskometer will provide an indication of how at risk your income may be. With 1 in 5 workers having to take 3 months or longer off work due to ill health (1) it is important to take this risk seriously and have a backup plan in place.

Please note the Income Riskometer is designed to provide a general indication of how at risk your income may be and should not be taken as an accurate reflection of the actual risk you do face. For advice tailored to your specific situation please speak to your Financial Adviser or call us on 0208 432 7333.

Your Result

High Risk - Medium Risk - Low Risk -

Find out how much you would pay to protect your income...

Your Risks Explained

  1. Drewberry Protection Survey, 2015 - http://www.drewberryinsurance.co.uk/press-release/protection-insurance-survey-2015
  2. Statutory Sick Pay figure accurate as of 07/04/2016. For more information please see https://www.gov.uk/statutory-sick-pay/what-youll-get
  3. Unum/Guardian ICM Poll, 2011
  4. Ageas Protect, report from their pricing data (released in 2011)
  5. Association of British Insurers (ABI), 2015 - https://www.abi.org.uk/News/News-releases/2015/08/Protection-insurers-help-more-families-than-ever-before-with-350-payouts-every-day
  6. Employment and Support Allowance (ESA) figure accurate as of 07/04/2016 - https://www.gov.uk/employment-support-allowance/what-youll-get
  7. Department for Work and Pensions (DWP) data, March 2016. Figures for all ESA applications 'to date' (Oct 2008 to Jun 2015). https://www.gov.uk/government/statistics/esa-outcomes-of-work-capability-assessments-claims-made-to-jun-2015-and-appeals-to-dec-2015
  8. Drewberry calculations based on Swiss Re, Group Watch 2015 data of group scheme membership and ONS Labour Market data

Our Mission...

We are insurance experts passionate about educating our clients and providing a 5-star service.

We are here to help you understand the financial risks you face so that you can make informed decisions when it comes to protecting yourself, your family and your assets.

Changing the world one policy at a time!

Occupation Definition Calculator

 

Make sure your Income Protection covers you in your 'Own Occupation'!

Too often individuals take out income protection without being fully aware of the incapacity definition on which their plan would pay out.

Will the plan pay out if I am unable to do my current job role? Or will it only pay out if I am unable to do any occupation?

If you do not already have income protection this tool should provide you with guidance as to what to look out for and to ensure you do not fall foul of a lesser occupation definition.

Your Occupation
 
Manual Work (%)
 
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   annual mileage  
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Frequently Asked Income Protection Questions

I am seriously considering income insurance for myself, I understand all the benefits but I’m worried that if my circumstances change in the future I may not need to cover so I want to know if I’m tied into to the policy at all?
I wanted to know why I should consider an income protection plan, why is this type of cover important? I have some savings (maybe about 6 months worth of income) but wouldn't get much sick pay. Do I need income protection insurance? Would I not receive state incapacity support of I had an accident or became sick in any case?
When looking for income protection quotes what does 'monthly benefit' actually mean, is this the amount the plan will payout?
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