Income Protection Insurance

Income protection insurance is designed to replace a portion of your income if you’re unable to work due to illness or injury.

Rather than a one-off lump sum, the policy pays out monthly for as long as you’re signed off work, up to the end of the benefit period or the policy term. The aim is to help you manage essential expenses, such as rent or mortgage payments, utility bills, and everyday living costs.

You can usually tailor your policy to suit your needs. That includes choosing how long the payments would last and how soon they would begin after you’re off work.

Some policies pay out for one or two years per claim, while others can continue until retirement if needed. The delay between being signed off and the first payment is called the ‘deferred period’. A longer deferred period usually lowers the monthly premium.

Income protection is not the same as critical illness cover. It’s there for ongoing support during a period where you’re unwell, not just in severe or life-threatening situations.

This kind of policy is often popular with self-employed workers or people whose sick pay from work wouldn’t last long enough to cover a recovery period.

You can read more about this in our full article:

Income Protection: What it Covers, How it Works & More

For many people, income protection is one of the most useful types of insurance. It’s not about covering rare or extreme events. Instead, it’s there to support you through more common health issues that can leave you unable to work for weeks or even months at a time.

Whether it’s a broken bone, a mental health condition, or a long-term illness, this type of policy can step in to keep your finances steady. Without cover, a loss of income could quickly lead to missed payments, debt, or relying on savings that may not last long.

With income protection in place, you have a plan that keeps essential bills covered while you focus on getting better. Like all insurance, it comes down to whether the benefit of having it outweighs the cost of the premiums.

For those without sick pay, with financial responsibilities, or with people depending on them, the reassurance it provides often makes it feel worthwhile.

You can read more about this in our full article:

Is Income Protection Insurance Worth It?

You might consider income protection when your financial stability would be affected by time off work.

If you’re the main earner in your household, or you don’t have much in the way of savings, the loss of income could quickly lead to pressure on your bills or rent or mortgage repayments. That is when this type of cover can step in.

It can also be particularly useful if your employer does not offer extended sick pay. Statutory sick pay only lasts for a limited period and may not be enough to support your lifestyle or financial commitments.

Income protection can offer some reassurance by giving you monthly payments to replace part of your income while you recover.

There is no perfect time to take out a policy, but many people think about it during key life stages such as moving home, starting a family, or becoming self-employed.

These are moments when your finances are more stretched or more people depend on you. If you’re unsure whether now is the right time, speaking to one of our protection advisors can help you weigh up your options.

Income protection is not right for everyone. If you already have substantial savings that could cover your outgoings for an extended period, you might feel the cover is not necessary.

Likewise, if your employer offers a generous sick pay package that would last long enough to cover any recovery period, you may be in a strong enough position without additional protection.

It might also not apply if you’re currently unemployed or not earning an income. This type of insurance is based on replacing lost earnings, so it only works if there is an income to protect. That said, if you’re planning to return to work soon or start a new job, it may still be worth looking into in advance.

Even if you think you don’t need income protection right now, your circumstances could change. It is worth checking how long your current financial arrangements would realistically support you in the event of illness or injury.

The cost of income protection varies depending on several personal and policy-related factors.

These include your age, health, job type, and whether you smoke. It also depends on how much income you want to protect, how long the payments would last, and how soon you would want them to begin.

For example, someone in a high-risk job or with pre-existing health conditions may pay more. Similarly, a policy that pays out until retirement will usually cost more than one that covers you for a year or two at a time.

The deferred period you choose can also affect the price. Longer delays between stopping work and the first payout usually mean lower premiums.

As a rough guide, income protection tends to cost more than life insurance but is often less expensive than many people expect, especially when tailored to a budget. Our protection advisors can help break down the options so you can find a policy that gives you the cover you need without stretching your monthly outgoings.

You can read more about this in our full article:

How Much Does Income Protection Insurance Cost?

Buying income protection starts with understanding what level of cover is right for your circumstances.

You will need to think about how much of your income you want to replace, how long you would want the policy to pay out for, and what kind of waiting period feels manageable before those payments start.

It is a good idea to speak with a protection advisor who can help guide you through the different types of policies and explain the small print. They will also take into account any existing sick pay you receive through your employer, and whether a short-term or long-term plan suits your financial situation.

The application usually involves answering questions about your job, health, and lifestyle. Some providers might also ask for medical information, depending on your background and the level of cover you’re applying for.

At UK Moneyman, we will walk you through each step so everything is clear and tailored to what you need. No pressure, just straightforward advice.

The type of protection insurance you need depends entirely on your lifestyle, financial responsibilities, and who relies on your income.

For some, income protection is the most important, offering regular monthly support if illness or injury stops them from working. Others might prioritise life insurance to help their family clear a mortgage or manage financially if they were no longer around.

If you have children, a partner, or any dependants, you might consider a combination of policies. Some people pair income protection with critical illness cover or family income benefit to build a more rounded safety net.

It is also worth thinking about whether you could manage without your income, and for how long. If losing your earnings would create immediate financial pressure, some form of cover is likely to help.

Our protection advisors can help break it down and guide you through the options based on what really matters to you.

Income protection is for anyone who relies on their earnings to maintain their lifestyle or cover monthly bills. That includes employed workers, the self-employed, and business owners. If a sudden loss of income would leave you or your household struggling, income protection can be a way to soften that impact.

It is not just for high earners either. In fact, it is often most useful for people whose savings would only last a short time if they could not work.

Even if you get some sick pay from your employer, it may only last for a few weeks or months. Income protection can continue supporting you well beyond that point, for as long as you need it or until the cover runs out.

If you’re looking for something that helps cover regular expenses while you recover from an illness or injury, this is the type of policy that can make a real difference.

If you’re currently unemployed and not earning an income, you will not be eligible for income protection insurance. That is because the policy is designed to replace lost earnings. Without an income to base the cover on, insurers cannot calculate a benefit amount.

That said, if you’re between jobs or planning to return to work soon, it may be worth waiting until your new employment starts before applying. Once you are back in work, you will be able to take out a policy based on your new salary and working hours.

If you are unemployed due to illness and receiving support through other means, such as benefits or disability payments, there may be other types of protection insurance that are more suitable. We can always chat through your situation and look at what makes sense for you now and in the future.

People take out income protection because it provides a safety net if they are unable to work due to illness or injury.

For many, it is about maintaining some financial stability in the face of the unexpected. If your income stopped tomorrow, income protection helps make sure your essential bills and expenses are still covered while you recover.

It is particularly helpful for those without access to long-term sick pay, or who are self-employed and do not have employer benefits to fall back on. Others take it out during key life stages, like starting a family or taking on a mortgage, when their outgoings are higher and there is more at stake.

The cover gives reassurance that even if life throws something difficult your way, your household can keep running. It is not about planning for worst-case scenarios, but about putting something in place that helps take the pressure off if you need time to recover.

The time it takes to get income protection set up depends on the provider, your application details, and whether any medical information is needed. Some policies can be arranged in a matter of days, especially if the application is straightforward and does not need further checks.

In other cases, it may take a little longer if the provider requests medical records or additional information. This usually happens when there is a pre-existing health condition or a more complex history to consider. You will be kept informed throughout the process, and we will help manage everything behind the scenes.

Once approved, your policy can start straight away or on a date you choose. If you already know when your sick pay ends, the policy can be timed to begin after that so there is no overlap.

Yes, stress and other mental health conditions can be covered under income protection, provided they prevent you from working. Policies vary, but many providers now recognise that mental health is just as important as physical health.

If you are signed off by a medical professional due to stress, anxiety, depression, or burnout, and your condition meets the criteria set out in your policy, you may be able to make a claim.

It is important to check how different insurers handle mental health claims, as there may be specific terms or support services included. Some policies might also offer rehabilitation support or counselling to help you return to work when you are ready.

If you have experienced stress-related issues in the past, this might be considered during the application process. Even so, it does not always mean you will be excluded from cover. If you are unsure, one of our protection advisors can explain how it all works and what to expect from the application.

Yes, income protection can be especially valuable if you are self-employed. Without employer sick pay or access to workplace benefits, you may be left completely reliant on your own savings if you cannot work.

An income protection policy gives you a monthly payout while you recover, helping you stay on top of rent, bills, and other regular costs.

When applying as self-employed, the insurer will usually base the cover on your average annual income. This can include profits from your business or freelance work. You will often need to provide evidence, such as recent tax returns or accounts, but the process is still very manageable.

Whether you run your own business or work freelance, having income protection in place can help make your finances more secure, even when your workload is not.

No, standard income protection does not cover planned maternity leave. If you’re taking time off to have a baby and that leave is arranged in advance, it won’t be eligible for a claim. Income protection is designed to replace income lost due to illness or injury, not for time off that’s already expected.

That said, if you were to experience a medical complication during pregnancy or after childbirth that prevents you from working beyond your usual leave period, you may be able to make a claim. The condition would need to meet the policy’s terms, and your doctor would need to confirm that you are unfit for work.

Some policies also offer added benefits like hospitalisation cover or recovery support, but this depends entirely on the provider. If you’re planning a family and wondering how income protection fits in, it’s worth reviewing your options with one of our protection advisors so you know what to expect.

No, income protection does not cover redundancy. It is designed to provide financial support if you are off work due to illness or injury, not job loss. Redundancy is not considered a medical reason to be off work, so a claim would not be accepted under a standard income protection policy.

If redundancy cover is something you’re interested in, there are specific policies designed for that purpose. These tend to be harder to find, can come with strict rules, and often require that you’ve been employed for a certain amount of time before you’re eligible to claim.

While income protection won’t help during redundancy, it can be useful when you return to work, particularly if your new role comes with limited sick pay. It gives you a way to protect your income going forward, especially if the next job involves different terms or more risk.

If you become unable to work due to illness or injury, the first step is to contact your insurer as soon as possible to start the claims process.

Most providers will ask for some paperwork, including medical evidence from your GP or consultant, and possibly some employment or financial details. This helps confirm that your condition meets the policy criteria.

You will also need to be signed off work for longer than the deferred period stated in your policy before payments begin. This is usually anywhere from 4 to 26 weeks, depending on what you selected when you set up the cover.

Throughout the claim, your insurer may keep in touch to check how you’re doing and whether your recovery is progressing. Payments will continue each month for as long as you’re signed off, up to the end of your benefit period.

If you have any concerns about the process, your protection advisor can help liaise with the insurer and support you through each step.

Income protection and critical illness cover are two very different types of policy, and the right one depends on what you are looking to protect.

Income protection pays out monthly if you are unable to work due to almost any medical condition, from common injuries to longer-term illnesses. It is designed to keep your income steady until you are well enough to return.

Critical illness cover, on the other hand, pays out a one-off lump sum if you are diagnosed with a serious condition listed in your policy, such as cancer, a heart attack, or stroke. It does not cover you for time off work due to more routine or short-term health problems, and it only pays once.

Many people take out both types of cover because they serve different purposes. Income protection helps with regular costs, while critical illness cover can help pay for bigger expenses or life changes. We can talk you through the differences in more detail and help you work out what fits best with your situation.

Here are some examples of illnesses commonly covered by Income Protection Insurance:

• Cancer, including treatment and recovery periods
• Heart conditions, such as heart attacks, angina, and heart surgery recovery
• Mental health conditions, including depression, anxiety, and stress-related disorders
• Neurological disorders, such as multiple sclerosis, Parkinson’s disease, and epilepsy
• Respiratory conditions, including asthma, chronic obstructive pulmonary disease (COPD), and severe pneumonia
• Musculoskeletal disorders, such as back pain, spinal issues, and repetitive strain injuries
• Stroke and its recovery period
• Chronic illnesses, such as diabetes, arthritis, and chronic pain conditions
• Gastrointestinal disorders, including Crohn’s disease, irritable bowel syndrome (IBS), and severe ulcers
• Infectious diseases, such as severe cases of flu, COVID-19, and other viral or bacterial infections
• Autoimmune diseases, including lupus, rheumatoid arthritis, and other autoimmune disorders
• Kidney disease, such as recovery from dialysis and kidney-related treatments
• Liver disease, including recovery from hepatitis, cirrhosis, or liver surgery

Here are some examples of injuries commonly covered by Income Protection Insurance:

• Fractures, including broken bones and recovery periods
• Sprains and strains, such as severe ankle sprains or muscle strains
• Back injuries, including slipped discs and spinal injuries
• Head injuries, such as concussions and traumatic brain injuries
• Burns, including severe burns requiring extensive treatment and recovery
• Joint injuries, such as dislocated shoulders or knee injuries
• Repetitive strain injuries, including carpal tunnel syndrome and tendonitis
• Severe cuts and lacerations that require significant healing time
• Whiplash and other neck injuries
• Eye injuries, including severe damage that impairs vision
• Hearing loss due to accidents or trauma
• Internal injuries, such as those resulting from accidents or blunt-force trauma
• Occupational injuries, including those sustained while performing job duties
• Injuries requiring surgery, including pre-and-post-surgical recovery periods

Cancelling income protection is usually quite simple. Most policies can be cancelled at any time by contacting the provider directly.

There is no need to give a reason, though it is a good idea to make sure you have got everything in place before you do. For example, if you’re switching to a different policy or provider, try to avoid a gap in cover.

If you’re cancelling because the cover no longer suits your needs or budget, it might be worth speaking with an advisor first. They can look at whether the policy can be adjusted, rather than cancelled altogether. In some cases, changing the length of the term or the benefit period can make it more affordable.

Remember that once cancelled, you will not be able to claim on the policy again, and any new application would be based on your age and health at the time of reapplying.