How would you pay for your existing lifestyle, as well as servicing any liabilities such as loans and mortgages? If you have a family, how would you be able to support them?

You may have savings but would you really want to use these? You may have some sickness cover with work, or believe the government will support you, but you may well find these both fall woefully short of supporting your existing lifestyle. You may even have critical illness cover, but usually this will only cover a liability like a mortgage, and will usually just be a one off lump sum payment.

Income protection is designed to cover you from illness or injury and you are unable to work. You will receive a monthly benefit of up to 60% of your gross income (minus other payments like other income protection policies or accident and sickness cover, excluding any state benefit entitlements).

All pay outs are tax free, and you can spend the money on anything you wish i.e bills, loan repayments, childcare, groceries and travel.

This monthly payment will continue until you either return to work, die or your policy ends. The maximum age is 69.

An example of how income protection works: if you break your leg (this could be at work or during leisure time) and need 6 months off work (depending on the deferral period you choose; between 3-12 months. Let’s assume 3 months in this scenario) the policy would kick in after the 3 months and you would then receive 3 monthly payments to support you.

If you then have a stroke and are unable to return to work indefinitely the payment would again kick in after 3 months and carry on until one of the above 3 scenario’s. Income protection doesn’t cover you for redundancy and voluntary unemployment. Your income is your most important asset, you need to ensure you protect it!