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International Group Income Protection pays an employee a proportion of their salary if they’re unable to work due to illness or injury for longer than an agreed deferred period. Unlike Critical Illness Cover (which pays out on a specific list of serious diagnoses), Income Protection responds to anything that medically prevents someone from doing their job.
For a UK-only workforce, this sits alongside statutory sick pay, topping it up to a more meaningful level of income replacement. For employees based abroad, statutory sick pay may not exist in the same way, or at all. This page covers what changes when it comes to International Income Protection.
Some countries have generous state disability or sickness benefits; others have very little. This means some employees may end up significantly worse off than UK-based colleagues in an equivalent situation; not because the policy is poorly designed, but because it wasn’t designed with their circumstances in mind. International Group Income Protection is built to account for this directly.
UK Group Income Protection is designed to work alongside statutory sick pay and government benefits. An employer offering it in the UK is topping up a system that already provides something, however modest. Employees based in other countries may have a very different starting point.
Whether a scheme is domestic or international, three key decisions shape what your International Income Protection policy looks like:
For a small number of employees overseas, adjusting an existing scheme or adding an international-specific policy is usually manageable without much complexity. Across a wider international workforce, a few things are worth deciding centrally rather than by default:
See our full guide: International Employee Benefits: A Guide for Employers, which covers programme structure, and cross-border compliance for a workforce spread across multiple countries.
If you already have a UK scheme, it’s worth checking whether international employees are already covered, or whether you’ll need a dedicated policy.
If your international exposure is limited to occasional business travel or short overseas trips by employees who remain UK-based and UK-employed, your existing UK Group Income Protection scheme will likely do the job.
However you may need or want to consider a dedicated international policies if you have employees who are:
The distinction that matters to insurers is whether someone is based abroad, for how long, and where. Get this checked against your actual policy wording rather than assuming standard business travel cover extends as far as you’d like it to.
Every business is unique, so it’s difficult to determine the cost of International Group Income Protection without knowing your exact needs. But as a general guide, your premiums will vary depending on:
If you want to compare International Group Income Protection quotes, we’re here to help. We have great relationships with the leading providers, and can comb through the fine print to find the most suitable policy for your needs. Give us a call on 02084327333 or email help@drewberry.co.uk to find out your options.
Joe Toft
Senior Employee Benefits Consultant
When it comes to International Group Income Protection, how the benefit is taxed and how it should be routed through payroll depends entirely on the local tax rules.
In the UK, the insurer pays the benefit to you as the employer, and it’s passed on to the employee through your usual payroll method, taxed as income in the same way salary would be. But many employers get caught out assuming the same applies everywhere.
It’s crucial to check with local tax specialists to ensure you’re fully informed on any liabilities.
Not reliably, and the gap can be more significant than with other benefits, because the policy is often designed around UK statutory sick pay as a baseline. If an employee is based somewhere with little or no equivalent state support, a domestic scheme’s deferred period and benefit level may leave them considerably worse covered than intended.
The definition of incapacity. “Own occupation” cover, where an employee can claim if they can’t perform their specific role, is the strongest version and the one worth prioritising; this matters just as much abroad as it does in the UK, and it’s not something to assume transfers automatically from a domestic scheme.
It should reflect what income support, if any, the employee has in the gap before the policy pays out; whether that’s local statutory benefits, sick pay from a local contract, or savings. This can look very different from the UK-standard 13, 26 or 52-week periods depending on where someone is based.
For employees taxed in the UK, the benefit is paid to the employer and then passed to the employee through payroll, taxed as income. For employees taxed elsewhere, this depends on local rules and should be confirmed with a specialist rather than assumed.
They cover different situations. Critical Illness pays a lump sum on diagnosis of a specific serious condition. Income Protection pays ongoing income replacement for anything that medically prevents someone working, including the more common causes of long-term absence like mental health issues and musculoskeletal problems that Critical Illness Cover doesn’t protect against.
If you’re looking to set up International Group Income Protection, or want to check whether your existing UK scheme provides appropriate cover for employees based overseas, our specialists can help. We’ll take the time to understand your workforce and requirements, compare options from across the market, and help you find the right cover for your business.
To learn more and compare quotes from across the market, get in touch with our specialists on 02084327333 for a no-obligation consultation.
Employee benefits can be a headache. But our specialists do this day-in, day-out, offering first class service when you need it most. Here’s why you should talk to us:
