Income Protection Cover
What is Income Protection Insurance
The amount of income you are allowed to claim will not replace the exact amount of money you were earning before you had to stop work. You can expect to receive about a half to two-thirds of your earnings before tax from your normal job. This is because some money will be taken off for the state benefits you can claim, and also the income you get from the policy is tax free.
Why Do I Need Income Protection Cover?
If you don’t have income protection insurance, you’re living with the risk of being unable to keep up with the cost of life if you lose your income through illness or injury. Obviously this risk will be different per person, depending on your individual circumstances – like what financial commitments and dependents you have. How long you end up being unable to work and what financial impact that could have on you also plays a part.
Lots of people would face financial hardship, straight away or over time, if they lost their income for medical reasons. This is because so many of us do have financial commitments, like paying for rent/mortgage, food and bills, which don’t go on hold when you become unable to work.