What Is The UK’s Best Income Protection Insurance In 2021?

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27-03-2021

When considering Income Protection Insurance it makes sense to try and find out which is the best policy but this can be hard to pin down as it will depend on your individual circumstances and requirements.

There are a number of factors which will need to be considered when searching for the best Income Protection policy including:

  • Your occupation
  • Employment status
  • Current health and lifestyle choices
  • Sick pay entitlement and savings

Each insurer has their own terms, underwriting and preferred type of client type so depending on how risky your job is or whether you smoke will impact on the best provider for you.

In addition to this expert guide we have also written expert product reviews for each of the top UK income protection providers individually including Aviva, Legal & General and Vitality.

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According to consumer group Which?, Income Protection is the one policy every working adult should consider.
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Getting The Best Income Protection…

This really depends on whether you are looking for Accident & Sickness cover only or whether you are looking to include Unemployment Insurance.

If your primary concern is protecting your income against the risk of illness or injury, then the best policies tend to have the following features:

Own Occupation Incapacity Definition

An Own Occupation definition of incapacity means that the plan will payout if you are unable to undertake your specific job due to any illness or injury (please note that many Payment Protection Plans use the ‘suited occupation’ definition of incapacity).

Long-Term or Short Term Income Protection?

Short term income protection is considered a budget option as it will often have a maximum claim length of 2 years. Traditional long term income protection would continue to pay a claim right up to the end of the policy term if you are unable to return to work.

Given LV’s average payout length of 7 years, it makes sense to take out a plan that wouldn’t limit the length of time it can payout for (i.e. it can payout until retirement if you are unable to return to work).

Popular policies with these characteristics include plans provided by Liverpool Victoria (LV), Aviva and Exeter Family Friendly.

Samantha Haffenden-Angear, Independent Protection Expert at Drewberry

If you are on a tight budget, short term cover is better than no cover at all.

However, the best income protection will protect you for your entire working life right up until retirement.

Samantha Haffenden-Angear
Independent Protection Expert

Including Unemployment Cover

Unemployment Cover is not usually offered under Income Protection plans, but there are some instances where it is available as an optional add-on. However, when looking for insurance policies that cover accident, sickness and unemployment, great care needs to be taken as many of these polices will be Payment Protection rather than Income Protection.

Avoiding PPI

We normally advise that people looking to protect their income avoid purchasing PPI because often the protection they provide isn’t as comprehensive as a traditional Income Protection policy.

They often use the suited occupation definition of incapacity (which means you can’t claim if you are fit enough to work in other job roles), have reviewable premiums (where the insurer has the right to change the amount they charge you based on a range of factors) and can usually only payout for a maximum period of 12 or 24 months.

If you are certain that you want unemployment cover, it may be worthwhile considering purchasing a separate Unemployment Insurance policy. This will ensure that you can still claim on a long-term basis for accident and sickness as well as claim benefits on a short term basis if you are made redundant.

Which Income Protection Cover Has The Best Terms & Conditions?

As mentioned above, it is important to take out a plan that provides own occupation incapacity protection so you are covered in your specific job role.

Lesser incapacity definitions include ‘suited occupation’ cover (where the insurer would assess your skills, experience and education and could decline a claim if they thought you were capable of undertaking another ‘suited’ job) and ‘activities of daily living / work tasks’ (where the insurer would make you undertake functional tests like walking or getting dressed before they would pay a claim).

Read the Fine Print

When deciding which is the best Income Protection plan for you, it is vital for you to check the terms and conditions as there are some plans in the market that would switch from own occupation cover after 12 or 24 months of a claim (such as Legal & General if you are a manual worker and Holloway Friendly).

Which Income Protection Has The Least Exclusions?

With any good Income Protection policy, it is often the case that policies do not have any standard exclusions, which means that the insurer would payout for any medical condition that prevented you from working, irrespective of how it arose.

No Standard Exclusions For Accident Or Sickness

  • Aviva
  • Liverpool Victoria
  • British Friendly
  • Exeter Family Friendly
  • Vitality
  • AIG

Some Standard Exclusions For Accident Or Sickness

  • Legal & General
    Incapacity resulting from drug, alcohol or solvent abuse;
  • Aegon
    War or civil commotion.

Please note though if you travel overseas for business or think there is a possibility that you may reside outside of the UK in the future then some policies do have restrictions. If you need help please don’t hesitate to pop us a call on 02084327333 or email help@drewberry.co.uk.

Redundancy Insurance Exclusions

Most insurers have an initial unemployment exclusion period where you cannot make a claim within the first 120 or 180 days of taking out the policy, and most plans only cover forced redundancy (i.e. you cannot take voluntary redundancy or get asked to leave due to poor performance).

Which Income Protection Providers Have The Best Payout Rates?

It is very natural to consider one Income Protection insurer as being better than another based on payout rates (i.e. the percentage of all claims that are paid).

For those insurers that do publish payout rates they tend to be very high, with most providers publishing rates that are over 90% of all claims made.

Please note that the payout rate is very unlikely to ever be 100% as there are always going to be issues with people not being truthful on their application and trying to claim for current / ongoing conditions.

Insurer

2017

2018

2019

Aegon

92.1%

93%

100%

Zurich

87%

95%

98%

Vitality

96%

97.8%

96.4%

Shepherds Friendly

96%

95.8%

96.3%

Cirencester Friendly

94.7%

95.2%

95.7%

Holloway Friendly

96%

98%

94%

British Friendly

92.4%

94.7%

94%

Liverpool Victoria

96%

95%

93%

The Exeter

91%

93%

91%

Aviva

88.8%

86.3%

85.7%

Legal & General

95%

95%

82%

Payout statistics alone should not be used to decide which insurer offers the best Income Protection.

Instead, payout rates should be used as a rough guide to compare successful claims across the industry as a whole.

Making An Income Protection Claim

Paying claims is the most important thing income protection insurers can do and over the past few years, there have been a number of developments making it easier for clients to claim as well as speeding up the process of approving claims.

A number of insurers are now accepting claims over the telephone completely doing away with lengthy claims forms.

If you have an income protection policy and have suffered an illness or injury which you think will result in a claim you are best to let your insurer know as soon as possible. The sooner they can start processing a claim the quicker they can approve it and start paying your benefit.

British Friendly and Neil’s Cancer Claim…

Neil is a client of Drewberry who took out an Income Protection policy with British Friendly. He’d had his policy for just 4 years before falling ill.

After experiencing a bout of stomach pains, Neil took himself to his GP who referred him on for further tests. These tests discovered that he unfortunately had bowel cancer, and it was already at stage 2.

Neil needed surgery to remove the cancer, but developed post-operative sepsis and had to spend several weeks in hospital recovering, completely unable to work.

British Friendly began paying him a proportion of his earnings after his deferral period, allowing him to keep up with all the important bills, such as his mortgage, which he was unwell.

🤕 Read More About Neil’s Claim

Which Insurers Offer The Best Premiums?

The premiums offered by each insurer depend on a number of factors, such as:

  • Your Age
  • Smoker Status
  • Your Current Health
  • Your Occupation
  • The Level and Length of Cover
  • Deferred Period

Different insurers like different risks with some being more competitive when covering higher risk occupations or when needing a much longer deferred period.

As a result of this there is no hard and fast rule who will be most competitive particularly if you have medical conditions you need to disclose.

You can use our Income Protection comparison tool to see how much the premiums would likely cost from the best income protection insurers who will quote online. However nothing beats speaking to an expert adviser as there are some insurers who simply don’t provide online results.

Please feel free to give pop us a call on 02084327333 to gain access to all quotes that would be available to you.

Example Cost of Income Protection

In the below table, we’ve laid out the average monthly cost of a good Accident and Sickness Insurance policy as well as an option including Unemployment Insurance.

To provide you with an example cost of Income Protection, we have had to make a number of assumptions:

  • The client is a healthy and in a low risk occupation
  • They want to cover £1,500 per month
  • They can survive without an income for 8 weeks
  • They are planning on retiring at age 65
  • They would like to fix the cost of the policy with guaranteed premiums.

The Income Protection quotes detailed below represent the cheapest policy that matches the above criteria from the best income protection insurers in the UK.

Age
🚭
🚬
Accident & Sickness Insurance
Age 25 £26.77 £36.09
Age 35 £39.13 £49.58
Age 45 £56.35 £84.31
Accident, Sickness & Unemployment Insurance
Age 25 £68.47 £77.79
Age 35 £66.58 £77.03
Age 45 £100.60 £128.56

Compare 12 Best UK Income Protection Insurance Providers In 2021

Being independent insurance brokers we work with all the top UK insurers when finding our clients the best cover.

To help you navigate the many potential pitfalls we have put together the table below summarising each of the major insurers products and our verdict on each of them.

Maximum Benefit

  • 65% of income up to £20,000; 55% of income between £20,001 and £100,000; and 45% of income more than £100,000.
  • Maximum benefit: £20,833

Claim Duration

Either:

  • Full cover to term
    Pays out with no limit, right up until your chosen retirement age if you can never work again.
  • 24 months limited payment term
    Pays out for up to 24 months for each incapacity. If you return to work for 6 consecutive months, you can claim again for the same illness / injury.

Deferred Period

4 / 8 / 13 / 26 / 52 weeks

Premium Type

Guaranteed

Claims Paid

100% in 2019, totalling £1.25 million

Additional Benefits

Aegon’s main additional  benefits offering is Policy Plus. This offers:

  • Health and wellbeing service
    Confidential support on a range of issues such as bereavement; martial / relationship concerns; consumer rights; legal and debt issues; and medical diagnoses
  • Second medical opinion service
    If you develop a serious health condition, you can have a face-to-face consultation with a UK-based specialist to review your diagnosis

Other benefits available include:

  • Death benefit of £5,000 if you pass away while Aegon is paying a claim
  • Income guarantee of at least £1,500 if your income falls between taking out the policy and needing to claim
  • Rehabilitation / proportionate benefit to top up a reduced income from work if you can only return to work in a lesser role / on less hours after an illness / injury

The Drewberry Verdict

👍

High maximum benefit available

🏆
  • Winner: Best Protection Service at every Moneyfacts Awards between 2017 and 2020
  • 5-star rating from Defaqto, an independent assessor of insurance policies

Fairly limited additional benefits

Maximum benefit of 55% of pre-incapacity earnings is lower than for some other insurers

AIG

Maximum Benefit

  • 60% of gross income up to £30,000; 55% between £30,000-£100,000; and 45% on gross income of £100,001+
  • Maximum benefit: £20,833 per month / £249,996 per year

Claim Duration

Either:

  • Full cover to term
    Pays out with no limit, right up until your chosen retirement age if you can never work again.
  • 24 months limited payment term
    Pays out for up to 24 months for each incapacity. If you return to work for 26 consecutive weeks, you can claim again for the same illness / injury.

Deferred Period

4 / 8 / 13 / 26 / 52 weeks

Premium Type

Guaranteed

Claims Paid

n.a.

Additional Benefits

Smart Health is AIG’s main additional benefits offering. It includes:

  • 24 / 7 digital GP service
  • Fitness and nutrition plans from qualified sports coaches / nutritionists
  • Mental health support / counselling
  • Annual health check via a pinprick blood test
  • Second medical opinion from Best Doctors

The Drewberry Verdict

👍

Smart Health provides an excellent range of additional benefits, among the best in the market

👍

High monthly benefit available

🏆
  • Winner: Outstanding Insurer of the Year, 2020 LifeSearch Awards
  • Winner: Best Health & Wellness Offering, 2020 Cover Customer Care Awards
  • Winner: Best Added Value Provider, 2020 Cover Excellence Awards
  • 5-star Defaqto rating

AIG does not publish claims data for Income Protection

Maximum Benefit

  • 65% of gross earnings up to £60,000; 45% of gross earnings above £60,000
  • Maximum benefit: £20,000 per month / £240,000 per year

Claims Duration

Either:

  • Full cover to term
    Pays out with no limit, right up until your chosen retirement age if you can never work again
  • 24 months limited payment term
    Pays out for up to 24 months for each incapacity. If you return to work for 6 consecutive months, you can claim again for the same illness / injury.

Deferred Period

4 / 8 / 13 / 26 / 52 / 104 weeks

Premium Type

Guaranteed or reviewable

Claims Paid

85.7% in 2019, totalling £44 million

Additional Benefits

Aviva DigiCare+

Free as standard, Aviva DigiCare+ is a health and wellbeing service offering:

  • 24 / 7 Bupa Anytime HealthLine, staffed by trained nurses to help manage minor health concerns
  • A Health MOT
  • Nutrition advice
  • Gym discounts
  • Up to six sessions of video / phone psychotherapy per year
  • Second medical opinion service on a recent diagnosis and your treatment options
  • Bereavement support if you lose a family member.

You can also opt to pay an extra £36 annually for three Digital GP appointments per year.

Other Free Benefits

  • Back to work benefit, paying a top up to your earnings if you can only return to work in a lesser role / on less hours after illness / injury
  • Hospitalisation benefit of £100 per night if you spend more than 6 consecutive nights in hospital during your deferral period, up to a maximum of 90 nights per policy term
  • Trauma benefit, paying the lower of £40,000 or six times your monthly benefit if you suffer one of six traumatic injuries

Optional Paid Benefits

  • Fracture cover, paying a lump sum of between £2,000 and £6,000 for a specified fracture depending on the type of fracture and the bone you break
  • Global treatment, offering you and your child(ren) access to Aviva’s Best Doctors service, a second medical opinion and overseas medical treatment if you need a medical procedure

The Drewberry Verdict

👍

Aviva DigiCare+ is a great suite of additional benefits available for free

👍

High monthly benefit available

👍

Further additional benefits available at cost, such as fracture cover

👍

Special conditions available for doctors, surgeons and other NHS workers

👍

104 week deferral period available, the longest in the market

🏆
  • Winner: Best Individual Income Protection Provider, 2019 Health Insurance Awards
  • Winner: Best Customer Service, 2020 Health Insurance Awards
  • 5-star Defaqto rating

While Aviva offers a digital GP service, which not every insurer does, it’s at extra cost and even then capped at three appointments per year

The percentage of successful claims paid is a little on the low side

Maximum Benefit

  • 70% of gross income
  • Maximum benefit: £45,000 per year

Claims Duration

Either:

  • Full cover to term
    Pays out with no limit, right up until your chosen retirement age if you can never work again.
  • Short term cover
    Pays out for 1, 2 or 5 years per claim depending on the option you choose

Deferred Period

  • Long term cover: 4 / 8 / 13 / 26 / 52 weeks
  • Short term cover: 4 / 8 / 13 weeks

Premium Type

Age-banded

Claims Paid

94% in 2019

Additional Benefits

  • Terminal illness benefit, waiving the deferral period and paying out straight away if you’re diagnosed with less than 12 months to live
  • Recovery support benefit, a lump sum of 4 times your weekly benefit 4 weeks after your final benefit payment to bridge the gap between your claim ending and your next pay day after returning to work
  • Care assistance benefit of £125 per week for up to 26 weeks if your spouse / partner / child suffers a serious illness / injury that means they need at least 35 hours a week of care for 4+ weeks
  • Death benefit of 6 times your benefit if you die during the policy
  • Bereavement benefit of 13 times your weekly benefit if your spouse / partner / child (up to the age of 18) dies during your policy term

Mutual Benefits

  • Mutual Rewards
    Discounted gift cards / e-vouchers offering savings of up to £250 a year on high street shopping, plus entry into quarterly prize draws with prizes of up to £1,000
  • Mutual Support
    Each year you get 150 Health Support Points for services such as virtual GP consultations, physiotherapy, counselling and second medical opinions. Once you’ve used your points you can still access these benefits at additional cost
  • Mutual Wellbeing
    Access to services to help improve / maintain wellbeing, such as health MOTs, a health and wellbeing app and information on leading a healthier lifestyle
  • Mutual Partners
    Discounts on services from British Friendly partners, such as Legal & General’s power of attorney / will writing service and 20% off Staysure Travel Insurance, which specialises covering those with pre-existing medical conditions

The Drewberry Verdict

👍

Offers own occupation cover to riskier occupations that many other insurers won’t cover on this basis or charge more due to their job

👍

Maximum entry age (the oldest you can be when you buy cover) of 64, the highest available in the market. Only one other insurer offers this entry age.

🏆
  • 5-star Defaqto rating

While British Friendly covers 70% of your earnings, the highest percentage available with personal Income Protection, it caps your benefit at £45,000 per year. If you earn more than this, another insurer might be better.

Maximum Benefit

  • 65% of gross earnings
  • Maximum benefit: £52,000 per year

Claims Duration

  • Full cover to term
    Pays out with no limit, right up until your chosen retirement age if you can never work again.

Deferred Period

Day 1 or 1 / 4 / 8 / 13 / 26 / 52 weeks

Premium Type

Guaranteed or age-banded

Claims Paid

95.7% of all claims in 2019

Additional Benefits

  • Terminal illness benefit worth 6 months of your benefit if a doctor diagnoses you with less than 12 months to live
  • Recovery benefit, which tops up to your income if you can only return to work after an illness / injury on reduced hours / in a lesser role
  • A Friendly Voice, a telephone helpline staffed by nurses who offer advice and emotional support to those suffering from, or caring for someone with, a physical or mental health issue
  • GP24, a virtual GP service offering 24 / 7 telephone calls with a GP, video appointments 8am-10pm 7 days a week (except Christmas day), private prescriptions and referrals for further investigation / treatment
  • Children’s critical illness support, a lump sum of £2,500 if your child (up to age 21) develops one of ten critical illnesses

Optional Add-Ons for an Extra Premium

  • Fracture cover
    A lump sum of £1,000 if you sustain a comminuted, complicated, compound, depressed or simple fracture to any of the 19 parts of the skeleton Cirencester lists
  • Hospitalisation benefit
    £50 per night for each night you spend in hospital. Cirencester pays this after 3 consecutive nights backdated to the first night. You can claim for up to 21 consecutive nights and for up to 21 nights per year.
  • Immediate death benefit
    A payment of £7,500 to your family if you die during the policy term before the age of 70

The Drewberry Verdict

👍

Offers own occupation policies to those in some higher-risk occupations that other insurers don’t cover on this basis

👍

Good range of free additional benefits, including a remote GP service, something often only offered by larger insurers

🏆
  • 5-star Defaqto rating

Annual benefit cap of £52,000. Higher earners needing more than this might be better with another insurer.

Maximum entry age is 54, so you can’t take out a policy if you’re older than this. This is one of the lowest in the market.

No cover if you work overseas for more than 8 weeks in a calendar year. This is more restrictive than many other insurers.

Maximum Benefit

  • 60% of gross earnings
  • Maximum benefit: £60,000 per year

Claims Duration

Either:

  • Full cover to term
    Pays out with no limit, right up until your chosen retirement age if you can never work again
  • 12 / 24 months limited payment term
    Pays out for 1 or 2 years for each incapacity depending on which option you select

Deferred Period

4 / 8 / 13 / 26 / 52 weeks

Premium Type

Either:

  • Age-banded
    Increase at a rate stated in your policy in line with your age. Holloway also reserves the right to review your premiums up or down after 5 years of coverage.
  • Level-priced
    Fixed for the first 5 years of coverage. Thereafter, Holloway reserves the right to review premiums up or down.

Claims Paid

94% in 2019

Additional Benefits

  • Terminal illness cover worth 6 times your monthly benefit if you are diagnosed with less than 12 months to live
  • Benefit guarantee of the lower of £1,500 or your monthly benefit if your income falls between taking out the policy and claiming
  • Rehabilitation benefit, paying an income top up for up to 12 months if you can only go back to work part time / in a reduced role due to illness / injury
  • Medical expenses benefit, a lump sum towards treatment a doctor recommends to speed up recovery following a claim, where Holloway’s Chief Medical Officer agrees
  • Premium holiday, allowing a break from the policy by pausing premiums and your ability to claim and the ability to restart it later without medical questions
  • Member assistance programme, a 24 hour telephone helpline offering counselling and advice from specialists on topics such as employment, health and consumer rights

The Drewberry Verdict

👍

While most insurers let you increase your benefit if you increase your mortgage, Holloway also lets you increase your benefit if your rent rises after moving to a new rental property / your landlord putting up your rent

👍

If you have hazardous hobbies, you can choose to exclude related illness / injury from your policy to avoid higher premiums. Most insurers don’t offer this and either charge more due to such hobbies or exclude them outright without charging less.

🏆
  • Winner: Best Individual Income Protection, 2019 Cover Excellence Awards
  • 5-star Defaqto rating

If you choose age-banded premiums, Holloway reserves the right to review them up or down after 5 years on top of raising them with age. With most other insurers, age-banded premiums only rise with age.

Maximum Benefit

  • 60% of gross earnings up to £60,000; 50% of gross earnings above £60,000
  • Maximum benefit: £20,000 per month / £240,000 per year (£14,000 per month / £168,000 per year with indexation)

Claims Duration

Either:

  • Full cover to term
    Pays out with no limit, right up until your chosen retirement age if you can never work again.
  • 12 / 24 months limited payment term
    Pays out for up to 12 or 24 months for each incapacity. If you return to work for 6 consecutive months, you can claim again for the same illness / injury.

Deferred Period

4 / 8 / 13 / 26 / 52 weeks

Premium Type

Guaranteed

Claims Paid

82% in 2019

Additional Benefits

  • Income guarantee of the lower of £1,500 per month or your benefit if your income falls between taking out cover and claiming (doubled to £3,000 for NHS dentists, doctors, midwives, nurses and surgeons)
  • Proportionate benefit, topping up your income if you can only return to work in a reduced role / on reduced hours following illness / injury
  • Hospitalisation benefit of 1/30th of your monthly benefit (up to £150) per night if you spend more than 8 consecutive nights in hospital for up to 13 weeks or until your deferred period ends, whichever is sooner
  • Death benefit worth 12 times your monthly premium if you die during the life of the policy
  • Rehabilitation service from nurses, physiotherapists and occupational therapists to help you return to work after a claim

Nurse Support Services

A telephone helpline staffed with qualified nurses to offer advice and support if you / an immediate family member develops a physical or mental health condition, disability, trauma or bereavement.

It offers:

  • Bereavement support
  • Advice on treatments and coping strategies, and help sourcing specialist equipment to make life easier after a serious illness / disability
  • Second medical opinion with a UK-based consultant if you have concerns about a diagnosis or treatment
  • Long-term support for a range of mental health conditions including depression, stress, PTSD and bipolar disorder
  • Emotional and practical support if you care for an elderly / sick loved one
  • A personal nurse adviser to offer telephone advice while you recuperate at home after a hospital stay
  • Support with eldercare, including help ensuring relatives can live independently or in a residential home and advice on how to keep them safe

The Drewberry Verdict

👍

High maximum benefit of £240,000 per year (£168,000 per year if you index your benefit). This is one of the highest available.

👍

Specialist cover for NHS medical professionals with features such as dual deferred periods to match NHS sick pay and a higher income guarantee

🏆
  • Winner: Best Protection Provider, 2020 TMA Partner Awards
  • 5-star Defaqto rating

Successful claims figures for 2019 are a little on the low side

If you’ve been self-employed for 12 months or less when you apply, Legal & General caps your benefit at 35% of annual earnings rather than the maximum offered to others. Newly self-employed workers are therefore likely to find another provider better.

Many insurers offer a death benefit worth a multiple of your monthly benefit. However, Legal & General’s death benefit is a multiple of your monthly premium, which will likely be much lower.

Maximum Benefit

  • 60% of your gross annual income
  • Maximum benefit: £12,500 per month

Claims Duration

Either:

  • Full cover to term
    Pays out with no limit, right up until your chosen retirement age if you can never work again.
  • Budget short term option
    Pays out for up to 12 or 24 months for each incapacity. With the 12 month option, you can only choose guaranteed premiums.

Deferred Period

4 / 8 / 12 / 26 / 52 weeks

Premium Type

Guaranteed or reviewable

Claims Paid

93% in 2019, totalling £14.2 million

Additional Benefits

  • LV Doctor Services, offering telephone- or app-based access to remote GP services, private prescriptions and a second medical opinion for you and your children (up to age 16)
  • Income guarantee of the lower of £1,500 per month or your original benefit if your income falls between taking out cover and claiming (doubled to £3,000 for NHS doctors and surgeons)
  • Fracture cover, paying up to £2,200 once per year if you suffer a specified fracture
  • Death benefit if you die during the policy term worth £5,000 if you’ve had the policy for 4 years or less, rising to £10,000 for policies 4+ years old
  • Parent and child cover, a payout of 6 times your monthly benefit, up to £25,000, if your child (up to age 21) develops a specified illness during the policy term

The Drewberry Verdict

👍

Good range of free additional benefits, including fracture cover as standard. This is rarely free with other Income Protection providers.

👍

Offers special features for NHS doctors and surgeons, such as an enhanced benefit guarantee and a split deferred period

🏆
  • Winner: Best Income Protection Provider at every Moneyfacts Awards 2010-2020
  • 5-star Defaqto rating

Shortest deferral period is 4 weeks. If you couldn’t wait 4 weeks for a payout, another insurer might be more suitable.

Maximum Benefit

  • 65% of gross annual income up to £15,000; 55% of the remainder
  • Maximum benefit: £250,000 per year

Claims Duration

Either:

  • Full cover to term
    Pays out with no limit, right up until your chosen retirement age if you can never work again
  • Short term
    Pays out for up to 1, 2 or 5 years for each incapacity depending on the option you choose

Deferred Period

4 / 8 / 13 / 26 / 52 weeks

Premium Type

Guaranteed

Claims Paid

91.6% of new and ongoing claims in 2019; 80.6% of all new claims in 2019

Additional Benefits

  • Income guarantee of the lower of £1,500 per month or your original benefit if your income falls between taking out cover and claiming (doubled to £3,000 for NHS doctors)
  • Fracture cover, paying a lump sum of up to £4,000 if you suffer a specified fracture. You can claim twice per policy year.
  • Hospitalisation benefit of £100 per night for up to 90 nights if you spend more than 6 consecutive nights in hospital
  • Back to Work Benefit paying 25% of your last benefit payment 1 month after you return to work after an illness / injury with short-term cover. This rises to 50% with long-term cover. It’s followed by 10% of your last benefit for short term cover and 25% for full term cover 2 months after you return to work.
  • Death benefit worth 12 times your monthly premium if you die during the policy term

Helping Hand

Free with all Royal London Income Protection policies, this offers:

  • A second medical opinion service
  • Support when recovering from a heart attack
  • Speech and language therapy after a stroke
  • Complementary therapies to help manage symptoms or help with recovery
  • Access to legal and career helplines for independent advice on employment rights and support in getting back to work sooner.

The Drewberry Verdict

👍

Good range of free additional benefits, including fracture cover. This is rarely free with Income Protection.

👍

High maximum benefit of £20,000 per month / £250,000 per year in cash terms

👍

Special features for NHS medical professionals, including an enhanced benefit guarantee, NHS sick pay mirroring and sabbatical cover

👍

Self-employed workers can cover fixed payments you must make alongside your wages, for example for services such as insurance or for loans / other credit

🏆
  • Winner: Best Protection Provider, 2020 Money Marketing Awards
  • 5-star Defaqto rating

Cover limited to 65% of the first £15,000 of your earnings and 55% of the remainder. This is lower than many other insurers. If you more than 55% of your earnings above £15,000, another insurer might be more appropriate.

Many insurers offer a death benefit worth a multiple of your monthly benefit. However, Royal London’s death benefit is a multiple of your monthly premium, which will likely be much lower.

Maximum Benefit

  • 70% of gross taxable income
  • Maximum benefit: £4,083 a month / £49,000 per year

Claims Duration

Either:

  • Full cover to term
    Pays out with no limit, right up until your chosen retirement age if you can never work again.
  • 24 months limited payment term
    Pays out for up to 24 months for each incapacity.

Deferred Period

4 / 8 / 13 / 26 / 52 weeks

Premium Type

Age-banded

Claims Paid

96.3% in 2019

Additional Benefits

  • Career break, letting you suspend cover, premiums and your ability to claim for between 3 and 24 consecutive months after holding the policy for a year
  • Rehabilitation support such as physiotherapy if Shepherds Friendly feels it appropriate to speed up your return to work
  • New child payment of £250 into a Shepherds Friendly Junior ISA if you have a child during the policy term
  • Death benefit of £1,000 per month for 6 months paid to your family if you die during the policy term

The Drewberry Verdict

👍

If your policy excludes a pre-existing condition, you can seek a medical review after 12 months, something other insurers don’t automatically offer. Shepherds Friendly may remove the exclusion if you haven’t had treatment for / any symptoms of the excluded condition for at least 12 months.

🏆
  • 5-star Defaqto rating

Minimal additional benefits

Maximum benefit cap of £49,000 per year. If you need more cover, another insurer might be better.

Maximum Benefit

  • 60% of gross income up to £100,000; 40% of gross income £100,001+
  • Maximum benefit: £10,000 per month / £120,000 per year

Claims Duration

Either:

  • Full cover to term
    Pays out with no limit, right up until your chosen retirement age if you can never work again.
  • 2 / 5 year limited payment term
    Pays out for up to 2 or 5 years for each incapacity depending on the option you choose.

Deferred Period

Day 1 / 1 / 4 / 8 / 13 / 26 / 52 weeks

Premium Type

  • Guaranteed premiums
  • Age-banded guaranteed premiums (rise each year with your age)
  • Age-banded reviewable premiums (rise with age; The Exeter also reserves the right to review these after 3 years)

Claims Paid

91% in 2019, totalling £7.7 million

Additional Benefits

The Exeter’s main additional benefits offering is HealthWise. This includes:

  • Up to four virtual GP consultations per year, including a prescription service
  • Second medical opinion service, offering up to two consultations per year after a recent diagnosis for advice on that diagnosis or treatment for it
  • Up to six physiotherapy sessions per year for musculoskeletal problems
  • Up to six mental health sessions per year to deal with conditions such anxiety, depression and substance abuse, as well as for emotional support

The Drewberry Verdict

👍

Good range of additional benefits free via HealthWise

🏆
  • Winner: Best Individual Income Protection Insurance, 2020 Cover Excellence Awards
  • Winner: Best Income Protection Insurance, 2020 Personal Finance Awards
  • 5-star Defaqto rating

As a smaller insurer, The Exeter doesn’t necessarily have the deeper pockets of some of its larger Income Protection rivals

Maximum Benefit

Income Protection / Short Term Income Protection

  • 60% of gross earnings up to £5,000 per month; 50% of any earnings above
  • Maximum benefit: £10,000 per month

Income Protection Cover Plus

  • 60% of gross earnings up to £5,000 per month; 50% of any earnings above
  • Maximum benefit: £16,666 per month

Claims Duration

Either:

  • Full cover to term
    Pays out with no limit, right up until your chosen retirement age if you can never work again
  • Short term — 2 year limited term
    A short term policy that pays out for a maximum of 2 years

Deferred Period

  • For employed workers: 4 / 8 / 13 / 26 / 52 weeks
  • For self-employed workers: 1 / 4 / 8 / 13 / 26 / 52 weeks

Premium Type

Guaranteed or reviewable

Claims Paid

96.4% in 2019

Additional Benefits

Vitality’s main additional benefits are via its Vitality Plus Programme, as well as the Vitality Optimiser and Wellness Optimiser add-ons.

These offer various benefits and discounts, plus the opportunity to reduce premiums by tracking your activity. The more points you get from activity, the bigger your potential premium discount.

On top of this, the below benefits are free with either the Income Protection / Short Term Income Protection policy or the Income Protection Cover Plus policy.

Income Protection / Short Term Income Protection

  • Benefit guarantee, so Vitality still pays your chosen monthly benefit (up to £1,500) if your income falls between taking out cover and claiming
  • Recovery benefit worth the lower of your full benefit or £1,000 towards therapies and nursing support if you make a claim

Income Protection Cover Plus

  • Benefit guarantee, so Vitality still pays your chosen monthly benefit (up to £1,500) if your income falls between taking out the policy and claiming
  • Recovery benefit worth the lower of your full benefit or £2,000 towards therapies and nursing support if you make a claim
  • Permanent disability increase, an uplift worth 10% of your benefit (up to a maximum payout of the uplift plus your original benefit of £200,000 per year) if you become permanently disabled and can’t do at least three activities of daily living
  • Hospitalisation benefit of £100 if you need to spend more than 7 consecutive nights in hospital up to a maximum of 90 nights

The Drewberry Verdict

👍

One of the highest maximum benefits available in the market

👍

Many other providers offer special deferred periods for NHS workers and teachers. Vitality extends this benefit to many other public sector roles such council workers.

🏆
  • Winner: Best Individual Protection Provider, 2020 Health Insurance & Protection Awards
  • 5-star Defaqto rating

To access many of Vitality Plus Programme benefits, you must maintain an active lifestyle. If you don’t, you may not get as many rewards and could face premium rises due to low levels of physical activity.

Maximum Benefit

  • 80% of net earnings
  • Maximum benefit: £20,000 per month

Claims Duration

Either:

  • Full cover to term
    Pays out with no limit, right up until your chosen retirement age if you can never work again
  • 24 months limited payment term
    Pays out for up to 24 months for each incapacity

Deferred Period

4 / 8 / 13 / 26 / 52 or 104 weeks

Premium Type

Guaranteed

Claims Paid

98% in 2019, totalling £7.2 million

Additional Benefits

  • Fracture cover — an optional add-on for an additional premium, this pays a lump sum once per year of £2,000, £4,000 or £6,000 if you suffer a specified fracture, dislocation, tear or rupture

With Standard Income Protection & Income Protection Select

  • Career break, letting you reduce your benefit (and therefore premiums) to as low as £250 per month for up to 12 months if you’re not working
  • Income guarantee of the lower of £1,500 per month or your original benefit if your income falls between taking out cover and claiming (doubled to £3,000 for NHS dentists, doctors, midwives, nurses and surgeons)
  • Zurich Support Services, offering access to counsellors, advisers and experts for guidance in areas such as legal support; debt / money management; emotional / mental health; careers and employment; relationships; and bereavement

With Income Protection Select Only

  • Trauma benefit, worth six times your monthly benefit up to £50,000 if you suffer a specified trauma during your policy term
  • Family carer benefit, paying up to £1,500 per month for 12 months if you have to stop working to care for a partner / spouse / child who cannot care for themselves
  • Hospitalisation benefit of £100 per night for up to 90 nights if you spend 7 or more consecutive nights in hospital
  • Funeral benefit worth the lower of six times your monthly benefit or £10,000 if you die during the policy term
  • A benefit of the lower of six times your monthly benefit or £50,000 if you contract Hepatitis B or C or HIV via a needlestick accident at work

The Drewberry Verdict

👍

Availability of special features for NHS doctors and surgeons, such as dual deferred periods to match NHS sick pay

👍

One of only two insurers to offer the 104 week deferred period

👍

Zurich’s fracture cover, while an optional add-on for an extra premium, also covers specified ruptures of tendons, tears in ligaments and dislocations. This is fairly unique in the market.

👍

Zurich’s maximum entry age (the highest age you can be at the start of your policy) is 64, the joint highest in the market

🏆
  • 5-star Defaqto rating

Many of Zurich’s additional benefits don’t come with its standard policy, only Income Protection Select. Many insurers include needlestick protection for NHS workers, a hospital benefit and a death / funeral payment as standard at no extra cost.

The Best Way To Set Up Income Protection

When setting up your Income Protection Insurance policy you can opt to go direct to an insurer or take out cover through an intermediary. It is important to recognise the difference as one provides you with a lot more protection than the other.

  • Going Direct to an Insurer
    If you go direct to an insurer to set up your policy it is considered a non-advised sale. As you personally have made the decision to take out this policy there is no financial protection should the policy be inappropriate – the responsibility lies on your shoulders.
  • Using an Adviser
    Utilising an adviser who provides an advised sale means they are responsible for the policy they help you set up. They need to understand your circumstances fully including any existing health conditions to make sure you take out the most suitable cover for your needs. If it turns out their advice was not appropriate the responsibility sits with the adviser.

Here at Drewberry we provide a fully advised service so you benefit from expert advice and know you have that additional level of protection should something go wrong.

We are proud of the service we provide and our clients think so too with 3115 independent reviews on Reviews.co.uk rating us at 4.92 / 5.

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Common Income Protection Questions...

  • What Is Better Income Protection Or Critical Illness Cover?

    Although these products may seem similar they provide financial protection in different ways. Each has their own merits and are used in different ways.

    Income Protection is designed to cover anything that medically prevents you from doing your job and pays out a monthly income to cover your regular bills.

    Providing you choose the ‘own occupation’ definition of incapacity, Income Protection pays out for accidents, illnesses and injuries that prevent you from doing our specific job role. You won’t be asked to perform any other job role if you can’t do your own occupation.

    Common illnesses claimed for under Income Protection policies include mental health issues, musculoskeletal problems (e.g. bad backs) and cancer.

    Critical Illness Cover pays out a tax free cash lump sum should you be diagnosed with a critical illness (such as cancer, heart attack or stroke) of a specified severity to claim.

    Critical illness cover is limited to the illnesses defined in the policy terms and conditions where Income Protection pays out for anything that medically prevents you from working.

     

  • Do I Really Need Income Protection?

    The question of whether you need Income Protection ultimately depends on your circumstances, but here are some factors to consider if you fell ill without it:

    • Could you survive on your savings for any considerable length of time?
    • Could you survive on government benefits, typically Statutory Sick Pay at £95.85 per week or Employment and Support Allowance at £74.35 per week?
    • How would your family cope with a sudden loss of income in terms of paying the bills, keeping up with the rent / mortgage, buying groceries, keeping a car on the road etc. if they didn’t have some form of continuation of income?

    If you’re not sure about the answers to these questions, Income Protection might be something you consider to protect your family and your finances in case you can’t work through accident or sickness.

  • What's The Maximum Income Protection Benefit?

    The maximum Income Protection benefit is typically 70% of your income for a personal policy. Insurers tend to offer between 50%-70% of your gross (pre-tax) income as a benefit.

    The reason you can’t insure 100% of your gross income is because, after taxes and National Insurance, you don’t receive 100% of your gross income from your employer or your self-employed activities each month / year.

    Most insurers will have a maximum ceiling in terms of the pounds sterling sum they’re willing to cover you for on an annual basis. This could be as low as £45,000 or up to £250,000, so it’s important you choose the right insurer for your level of income.

  • How Long Does Income Protection Last?

    Short-Term Income Protection will pay out for a maximum of 1, 2 or 5 years per injury / illness per claim. However, the policy lasts until your set retirement age, so you can claim as many times as you need to with different illnesses or injuries for the maximum term.

    If you suffer an illness / injury that takes you beyond the maximum claims period on Short-Term Income Protection, your payments will cease.

    Long-Term Income Protection is a more comprehensive option as you can claim as many times as you need to, for as long as you need to, right up until retirement age.

    This means if you’re ever so ill you can never work again, you’ll be entitled to receive your Income Protection benefit right up until your chosen policy cease age.

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Compare Best Income Protection Quotes & Get Expert Advice

Finding the best Income Protection can be a bit of a minefield particular given the confusion that can occur with Payment Protection and the importance of getting ‘Own Occupation’ cover.

We exist to ensure you have the information and the support you need when setting up the most appropriate Income Protection for your circumstances.

Why Speak to Us?

We started Drewberry™ because we were tired of being treated like a number.

We all deserve a first class service when it comes to issues as important as protecting our health and our finances. Below are just a few reasons why it makes sense to talk to us.

Please don’t hesitate to give us a call on 02084327333 or email help@drewberry.co.uk, we are here to help.

Very helpful from start to finish. Talked through all the points and gave great advice.

Darren Comer
16/05/2021
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Contact Us
Head Office & Pensions and Investments
Senator House
85 Queen Victoria Street
London
EC4V 4AB
Personal Insurance & Accounts Payable
Telecom House
125-135 Preston Road
Brighton
BN1 6AF
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Our Core Principles
  • 1You Come FirstWe are a client focused business who always aim to put you first.
  • 2We are ExpertsTo provide you with the best advice, we need to know our stuff!
  • 3We are HumanWe are real people with feelings who are here to help you.
  • 4We are ProfessionalProviding a 5-star service requires a professional approach to everything we do.
  • 5We are here to EducateWe don't believe in sales, we are here to educate so you can make informed decisions.
Finalist - Moneyfacts AwardsFinalist - Cover Excellence AwardsHighly Commended - Protection Review Awards
Proud member of AMII (Association of Medical Insurers & Intermediaries)Proud member of Money Advice ServiceProud member of UnbiasedProud member of BIBA (British Insurance Brokers' Association)

If you are unhappy with our service, we have a complaints procedure, details of which are available upon request. If you are unhappy with how your complaint has been dealt with, you may be able to refer your complaint to the Financial Ombudsman Service (FOS). The FOS website is www.financial-ombudsman.org.uk.

Drewberry Ltd is registered in England and Wales. Companies House No. 06675912

Drewberry Ltd registered office: Telecom House, Preston Road, Brighton, England, BN1 6AF. Telephone 0208 432 7333

Drewberry Ltd (Financial Conduct Authority No. 505473) is an Appointed Representative of Quilter Wealth Limited and Quilter Mortgage Planning

Limited, which are authorised and regulated by the Financial Conduct Authority.

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