Furlough was a hot topic for over a year in the UK. You can think of income protection as your own personal furlough scheme. It is an insurance policy designed to pay out a tax-free monthly benefit if you were unable to work.
It is usually calculated as a percentage of your current earnings, up to 75%. It will pay out if you are unable to work due to an accident or illness, including mental illnesses. It does not, however, cover you if you were made redundant.
Like any type of insurance, there are lots of different types of policies to consider and varying levels of cover.
Income protection is suitable for anyone that earns an income and has bills to pay or has a family that relies on their income to support them. If you were unable to earn an income, how long will your employer pay sick pay for and what would you do after that
Perhaps your employer doesn’t pay any sick pay at all. You would be relying on the government’s Statutory Sick Pay of £99.35 per month. Would that pay your mortgage/rent, bills, and food shopping?
Income protection is especially meaningful for self-employed people with no employer sick pay at all.
Income Protection is a financial product that many don’t put in place. Working out what type of policy you need isn’t the most straight forward thing and many people that revert to comparison websites end up with ineffective cover or no cover at all.
Getting actual advice is vital when taking out any protection policy. There are so many different things to consider, such as the type of policy you want, your budget, the type of work you do, how long you want the policy to pay out for and more.
We will carry out a full review of your circumstances, including any existing policies. We will then search the market for a policy designed to meet your needs within your budget and make a recommendation. We will then take care of everything for you, from the application to the underwriting and any medical reports if necessary.
Here are our 3 most commonly asked questions around protection.
No, no mortgage lenders have made life insurance compulsory when you get a mortgage. However, it is highly recommended if you have a family and want to relieve any financial burden on them if you were to pass away.
There is no set cost for this type of insurance as it’s based on your individual circumstances and needs. Things like your medical history, height and weight and smoker status get taken into consideration when insurers give you a quote.
Like any insurance product, protection products won’t pay out if you didn’t disclose vital information when you initially made the application, or for fraud. Other than this, if the claim is for something covered under the policy conditions, it should pay out.
So that we can identify your options and the best next steps to take, have a free, no obligation chat with us. We will learn about and you and your circumstances in order to develop a bespoke plan of action.
As the mighty Oak Tree represents longevity, strength & stability, we specialise in forging long term relationships with our clients based on trust and honesty, to build solid foundations for their future.
Oak FS Ltd trading as Oak Financial is registered with the Data Protection Act 1998 Registration Number ZB473115 and is authorised and regulated by the Financial Conduct Authority under Firm Reference Number 1015779 and are an Appointed Representative of TMG Direct Limited which is authorised & regulated by the Financial Conduct Authority under Firm Reference Number 786245 and registered with the Data Protection Act 1998 Registration Number: ZA178200.
Think carefully before securing debts against your home. Your home may be repossess if you do not keep up repayments on a mortgage or any other debt secured on it. The guidance contained within this website is subject to the UK regulatory regime and is therefore targeted at consumers based in the UK.
