Income Protection

Types of Income Protection

How you would cope financially if you were unable to work due to unemployment,  illness or accidental injury? How would you pay your mortgage and household bills? Would you be able to maintain your current lifestyle?

There is a wide range of different insurance products designed to protect your income, whether it be against un-employment, accident and sickness, or short and long term disability. Not all income protection insurance products are the same, some are suited to short term protection and others designed to maintain income in the long term, and many have the ability to add valuable extra benefits, known as “options”, making the overall range of income protection products available fairly substantial.

When you are looking to buy any form of income protection insurance, it is essential you take into consideration what employment and state benefits are available to you. Simply buying the basic form of income protection, ie: with no options added, might be OK for some people, but for others more complex solutions may be advisable.... use our call back to speak with an "in-house" independent financial adviser, who will explain your choices and options.

Don't settle for second best, engage your own independent financial adviser with "Call Back".


Be Better Protected

Protecting your mortgage payments
It’s impossible to know what the future will hold. If you were to become un-employed or if you were disabled due to an accident or sickness, could you maintain your mortgage repayments?  How long will your employer pay you if you're ill ? What if you're self-employed ?  Mortgage Payment Protection Insurance can help reduce any worries you may have.

Protecting your income
Unless you have sufficient independent means, the sudden loss of income through accident, sickness or unemployment today, could result, not only in putting your home at risk, but also your standard of living. How would you pay your bills; your outgoings don’t stop just because your income does.

On October 27th 2008, Incapacity Benefit and Income Support arising from inability to work due to ill health were replaced by Employment and Support Allowance (ESA) combining both means tested and non-means tested elements.
Entitlement to ESA depends on your National Insurance (NI) contribution record and your financial circumstances.

Generally speaking, if you are employed, you may qualify for either Statutory Sick Pay (SSP) or Occupational Sick Pay (OSP) before claiming ESA. Employers are required to pay SSP or OSP from day 4 for a maximum of 28 weeks, it is based on a certificate from your GP.

Currently, SSP is £81.60 per week. Those not entitled to either SSP or OSP, for example the Self Employed can move straight to ESA if they have paid sufficient NI contributions.

ESA has an “Assessment Period” of 13 weeks.
During the 13 week assessment period you will be paid £53.45 pw if you are aged under 25 or £67.50 pw if you are 25 or over.

At the end of this 13 week period, if you are considered capable of work-related activity you will be allocated to a work-related benefit group, if not you will be allocated to a support benefit group.

It is estimated that around 90% of new claimants will fall in to “work related benefit” group and 10% in to “support benefit” group.
In the work-related group you will receive a benefit of £94.25 pw (all age groups). However this will be conditional upon:

- Attending a series of work-focused interviews
- Agreeing an action plan aimed at getting you back to work.

Failure to observe these conditions could see your benefit reduced back to £67.50 pw in two stages, depending upon for how long this continues. You are also under an obligation to follow medical advice about the treatment of your condition.

In the support group:

You will receive a benefit of £99.84 pw (all age groups). No conditions apply but you are free to seek work-related advice and support should you wish to do so.
Means testing means that any regular income you or other family members receive will be offset against the benefit you qualify for.

If you have capital of £16,000 or more you are not eligible and the rates are reduced if you have between £6,000 and £16,000.

However, the value of your home, the assets of any business you own or any personal pension fund do not count towards these capital limits.
The level of support of means tested benefits remain well below the income levels for those with mortgage and rent commitments and the income expectations we have come accustomed to –

If you do not insure, you are risking your capital and possibly your home. Illness or disability can quickly drain your savings and investments and is a common cause of repossession of homes in the UK.


State Benefits...

Employment Support and Allowance (ESA) was introduced in October 2008, replacing Incapacity Benefit and Income Support, and has changed the way Government Disability Benefits are paid....

»»»   What is ESA

»»»   How ESA Works

»»»   Assessment Rates

»»»   Post Assessment Rates

»»»   Means Testing

»»»   Should you insure?

When considering income protection insurance we recommend you take into account any current and future employment benefits, if you are employed - for example: there may be little point insuring yourself for sickness protection from week 4 where your employer maintains your salary for 26 weeks.

Equally, consider splitting your income protection plans - why not consider different deferment periods where appropriate.

Your independent adviser will provide details of split benefit plans.

When you engage one of our "in-house" financial advisers, using "Call Back", your choices, and extras, are explained....

Don't settle for second best...  0845 1280152