INCOME PROTECTION INSURANCE

WHAT TYPE OF PROTECTION IS THIS?

What would you do if you had an accident and were unable to work? This consideration is obviously more important for self-employed tradespeople than most other professions. If you can’t physically work, then you will be unable to earn money, and given the nature of the work you undertake, accidents can happen.

Personal Accident & Income Protection insurance are two types of insurance cover that protect for this, paying out compensation if you suffer from a serious injury or death as a result of an accident or are unable to work due to sickness. The compensation can help protect against loss of income and help with other bills and expenses whilst you are unable to work.

INCOME PROTECTION INSURANCE SUMMARY

• Policy pays a monthly benefit where you are unable to work
• Payment of up to £2,500 per month (or 60% of your income)
• Lump sum payment of 12 times the monthly benefit in the event of your death
• Monthly or annual payment options
• Instant cover with documents immediately

WHAT IS THE DIFFERENCE BETWEEN PERSONAL ACCIDENT INSURANCE AND INCOME PROTECTION?

There are two types of insurance, Personal Accident and Income Protection and you can purchase either in isolation or both together. Personal Accident pays out a lump sum in the event of certain defined accidents and injuries. Income Protection pays out a monthly benefit for a period of time if you are unable to work due to an accident or sickness. You need to be aged between 18 and 65 to purchase insurance and insurance ends when you attain the age of 67.

More specifically these insurances provide the following protection:

INCOME PROTECTION INSURANCE

• Where you are unable to work for a period of time due to an accident or sickness this Policy will pay a monthly benefit payment based on the option you have chosen up to a maximum of £2,500 per month.
• You can choose your monthly benefit provided it does not exceed 60% of your gross monthly income (if employed) or 60% of your taxable monthly income (if self-employed).
• In addition, if you die as a result of an accident the Policy will pay a lump sum of 12 times the monthly benefit amount.
• Note that the Policy will not make any payment for the first 30 days that you are unable to work due to an accident or sickness.

As with any insurance Policy some things are not covered, including an accident or sickness resulting from the following:

• Any sickness diagnosed within 90 days after the policy commencement date
• Any pre-existing medical conditions (including diagnosed COVID 19 cases) unless you have been symptom free and not received treatment or advice for that condition for at least 24 months preceding a claim or where you had COVID 19 symptoms but did not receive hospital treatment as an inpatient or outpatient.
• Chronic conditions
• Elective surgical procedures
• Specified back conditions
• Stress, anxiety, depression or any emotional disorder
• The taking of alcohol or drugs

We recommend that you read the Policy Document in full before deciding whether to purchase cover.