This is designed to pay out a monthly income to you are unable to work due to having an accident or becoming sick.
These policies are great because if you had a car accident and you broke your hand, which was going to take months to heal, your rent, mortgage or bills will still keep coming in. It would be handy to know that you have something in place to cover this eventuality. A policy like this would be able to pay you until you return to work, no matter how long that took.
Income Protection works in this way. If you wanted to cover £1000 over 25 years (maybe in line with a mortgage although you don’t have to have a mortgage to get this policy). If you had an accident or became sick in year 5 and they start to pay you monthly payments then as long as you are not fit enough to return to work you will be paid out for the extra 20 years you have the cover.,
There are different types of cover under this policy which can cover you if you are unable to return to your own normal employment or maybe will cover you if you are unable to work doing “any occupation” so there are lots of different elements to this but please make sure when you speak with your adviser you know exactly what you are getting and what you are covered for. For example, if you have covered for “own occupation” then as long as you are unable to return to the job you are doing currently you will be covered. If you choose the “any occupation” definition, they will only pay out if you are unable to return to any form of work
Imagine if you had life and Critical / Serious Illness cover and Income Protection and you contract cancer then you could make a claim and get a lumpsum to repay your mortgage under the critical illness policy then you could make a claim on the Income Protection policy to also get a monthly income until you return to work taking the stress out of having to work to pay the bills when you are ill.
Income Protection Q&As
1. The ASU policy will pay out for only 12 or 24 months depending on which policy you take where the Income Protection policy could end up paying for a much longer time for long term sickness or accidents
2. The other main difference is an ASU policy covers for Unemployment where an Income Protection Policy does not
It is worth noting that the insurers do charge more for particular jobs, such as people who work over 30 feet, por people who drive more than 20,000 miles per year. It is worth while asking our independent advisers as some providers don’t charge more for various types of jobs.