Income Protection Insurance
Income protection insurance is designed to replace your income should you be unable to work due to illness or accidental injury.ActiveQuote's income protection comparison system offers free income protection insurance quotes online in less than two minutes, to help you find affordable income protection for accident, sickness and unemployment. With ActiveQuote you can compare income protection quotes from leading UK insurers to find the best policy for your budget.
Why do I need Income Protection Insurance?
Half of the UK population would survive financially for just 17 days should they suffer unexpected loss of income. Ask yourself the following questions:- Would state benefits allow me to maintain my current lifestyle?
- Could I live off my partner’s income indefinitely?
- Do I have savings I could live off indefinitely?
What does Income Protection cover?
With UK income protection insurance, you will not need to use your savings or rely on state benefits if you are unable to work. People take out income protection cover for a number of different reasons, including:- To protect the cost of mortgage or rent payments
- To protect their loan, credit card or car finance payments
- To meet their monthly commitments, like utility bills, food bills or internet
- To protect their general lifestyle like holidays, school fees or gym membership
What types of Income Protection Insurance are available?
Income insurance can be divided into long-term policies and short-term income protection policies. The kind of income protection policy you need will depend on how long you require your cover to pay you an income.Long term income protection
Long term income protection cover will provide you with a regular tax free income if you can’t work because of an illness or disability. Long term income insurance will continue to pay out until you can get back to work or until the end of the policy term, which is usually retirement. Long term policies are very flexible- our income protection comparison system will let you tailor your online income protection quotes to suit your needs and your budget.Short term income protection insurance
Short term income protection cover is designed to cover periods of temporary unemployment and incapacity, or to meet the cost of a specific debt. Short term policies will generally pay out for 12 months rather than until recovery or retirement. There are three types of short term income protection:- Accident, Sickness and Unemployment (ASU): Pays a tax free monthly income for a maximum of 12 months if you were off work due to sickness, accident, or unemployment.
- Mortgage Payment Protection Insurance (MPPI): Gives a monthly payment to meet mortgage and mortgage related expenditure in the event of accident, sickness and or unemployment.
- Payment Protection Insurance (PPI): Covers credit repayments, such as loans or credit cards if you were unable to work due to accident, sickness or unemployment.
Income Protection - Frequently Asked Questions
Income protection is designed to replace your income should you be unable to work due to illness, accidental injury or redundancy.Why should I invest in Income Protection?
Having Income Protection means you will not need to
use your savings or rely on state benefits if you are unable to work
through sickness or accidental injury. Ask yourself the following
questions:
- Would state benefits of up to £99.85 a week* allow me to maintain my current lifestyle?
- Could I live off my partner’s income indefinitely?
- Do I have savings I could live off indefinitely?
If the answer is no to the above, then you should
probably consider Income Protection. An Income Protection Policy will
provide you with a regular tax free benefit to give you time to get back
on your feet after an accident or an illness.
Some Income Protection policies will also replace
your income if you are made redundant. There are currently 847,000
people in the UK who have been out of work for more than 1 year
following redundancy. An Income Protection policy will give you the
financial support you need when looking for a new job.
Save money on your income protection insurance
For how long will Income Protection pay in the event of incapacity?
The benefit period is the length of time that your
policy will pay you for if you are unable to work through illness or
accidental injury. There are two main types of Income Protection: long
term and short term.
Long term Income Protection
Otherwise known as permanent health insurance (PHI), Long Term Income Protection
is designed to replace your gross monthly income right up until
retirement age should you be unable to work due to illness or injury.
Short term Income Protection
Otherwise known as Accident, Sickness and
Unemployment (ASU), short term IP replaces your income for up to 12
months should you be unable to work due to accident, sickness or forced
unemployment. Accident, Sickness and Unemployment can be used to cover
your general lifestyle costs, or it can be tied to a particular debt. Mortgage Payment Protection Insurance (MPPI) and Payment Protection Insurance (PPI) are examples of the latter.
Do I get any money back if I don’t claim before the end of the policy?
You will not get your money back if you do not claim before the end of your Income Protection policy.
Is my benefit tax-free?
Yes, Income Protection Insurance will pay you a monthly tax free benefit to replace your income.
How much will Income Protection cost me?
The price of Income protection can vary hugely
depending on the type of policy you choose. The premiums are calculated
based on the amount of cover you require, the length of cover you
require, your age, your smoker status, and sometimes even your current
health and your occupation.
What exclusions might my Income Protection policy have?
A typical short term Accident, Sickness and Unemployment (ASU) policy will exclude you for the following:
- Dangerous sports or occupations
- Deliberate self-injury
- Any pre-existing medical condition related to stress, back problems or normal pregnancy
- AIDS related conditions
- Conditions due to drug and/or alcohol abuse, or criminal activity
If your policy also includes unemployment cover, you will not be protected if you:
- Knew or had reason to believe you might become unemployed
- If your work is temporary or seasonal, or you accept voluntary unemployment
- Become unemployed within the initial exclusion period.
All long term Income Protection policies will need to
be medically underwritten, so pre-existing conditions may be excluded
from the cover. A full list of exclusions will be provided with your
policy.
Why should I compare Income Protection with ActiveQuote?
At ActiveQuote we understand that choosing an Income
Protection policy can be a daunting task. That’s why our online
comparison system will compare long and short term IP policies to help
you find a quote that suit your needs and your budget. We compare Income Protection policies from all the leading UK insurers, and allow you to change your options online with instant updates to the price.
If you are struggling to decide on an Income
Protection policy, an ActiveQuote advisor is always on hand with free,
no obligation advice. For more information about why we are the best,
take a look at our About ActiveQuote page.
Key products: Income Protection, Insurance, IP, FAQ, Frequently Asked Questions, Compare Income Protection, Quotes
