Income Protection Insurance

What is Income Protection Insurance?

Have you considered how you would cope financially if you could not work due to an illness or disability? State benefits will only pay £88.45 (as of June 2016) per week for a maximum of 28 weeks and that is if you are entitled to claim. How would you make the mortgage payments, pay bills, supply for your family and buy petrol, food, etc.

Income Protection Insurance, also known as Income Protection, Income Insurance or Income Replacement Cover, provides you with a tax free monthly income until your selected retirement age (usually between 50 and 70) if you are unable to work due to an illness or disability.

The premiums are calculated based on your occupation, age, health, estimated retirement age and the amount/level of cover that you choose. When applying for cover you will need to select a deferment period, this is usually 4, 8, 13, 26 or 52 weeks, and represents the amount of time that you will need to be off work before you can claim. Please note that we also offer deferment periods of 1 day and 1 week, if you are interested in these options please Contact Us.

Income Protection Insurance is often mistaken for ASU (Accident, Sickness and Unemployment) Cover. Income Protection provides long term protection of income for illness or disability, whereas ASU provides short term cover for Accident, Sickness and redundancy. For more information regarding the differences between these policies, please view our online comparison here.

Here at Top Quote Online we allow you to instantly compare Income Protection Policies from the UK's leading providers through use of our advanced online quotation system. We are one of the leading brokers for Income Protection Insurance in the UK and you can either get an Instant Income Protection Quote Online or speak to one of our qualified advisors by calling us free on 0808 1782 777.

I am Self Employed, can I Protect my Income?

Most self employed persons whether as a sole trader or partnership are able to take out income protection cover, however you must be extremely cautious with regards to eligibility and income. Firstly your income is defined as your 'net profit' declared on your self assessment forms: This is your income before you pay tax but after your business expenses have been deducted. At the time of claim income protection is based on your income (normally over the last 12 months or last tax return) so you need to keep an eye on your benefit to ensure you do not become over- insured further down the line.

I am a Company Director, can I Protect my Income?

Yes, Company Directors are technically employees of their own companies so they can take cover out. You will need to be careful if you take dividends as different insurers look at them differently. Many providers will consider your dividends alongside your salary in the event of an incapacity claim, however if you continue to draw dividends from the company during incapacity then your claim may be reduced. It should be noted that some insurers will look at an average of the last 12 months and some the last 36 months. Some insurance companies will not take dividends into account at all.

I work Part Time, can I Protect my Income?

If you work more than 16 hours per week most companies will allow you to take out cover, but you must make sure you do not over insure yourself. Remember you can usually insure yourself for around 50% of your gross annual income although some companies do slightly more than this.

I am Unemployed, can I Protect my Income?

Typically you cannot take income protection insurance out if you are unemployed. Although some companies will offer a policy called House Person's Income Protection which covers a set monthly benefit if you are unable complete a number of daily actives. The alternative to this of course is to look into Critical Illness Cover which is not financially underwritten.

How Much Income Protection Insurance do I Need?

Most income protection companies in the UK offer a maximum of 50-65% of your annual salary, however based on current legislation you do not pay tax on these benefits. To assess how much cover you require, we recommend that you figure how much money you require per month, i.e. mortgage payments, rent, bills, food, etc. and use this as a starting figure. Most people insure around 50% of their income, however some people only decide to cover mortgage payments. If you require any advice on this you can contact one of our experienced advisors by using the details on our Contact Us page.

What is Index Linked Income Protection Insurance?

This means that your cover will increase each year in line with inflation. Do be careful though as your premiums will also increase if you choose this option. Typically this is a good idea as £1000pm now will not be worth the same in 10 years time. Again you need to be careful that you are eligible on an ongoing basis with index linked cover as you will still be assessed at point of claim based on your taxable earnings.

Can I Claim in Addition to Sick Pay or Other Policies?

Most policies will have a clause that states they will pay up to a certain percentage of income minus any other income you may receive. This can include other insurance policies and/or sick pay, it may also dependent upon the chosen policy, class benefits such as jobseekers allowance into account. For this reason it is always worth speaking to an advisor before arranging income protection.

Latest Income Protection Insurance Articles

  • Easy Ways To Protect Your Income

    published on the 19th June 2015 by Kathryn Knowles

    At some point in all of our lives, it's very likely that we will get ill and need some time off work. It's just a fact of life and whilst there isn't a lot we can do to completely prevent it, there are things we can do to make it a little easier on ourselves and our families. The aim is very simple... if we don't work (for most of us anyway)... read more

  • Income Protection Insurance for the Short and Long Term

    published on the 10th March 2015 by Kathryn Knowles

    Income Protection Insurance provides a monthly income in the event that you are unable to work due to an accident or significant illness. It is possible to include involuntary redundancy on some policies depending upon the options that you go for. Income Protection Insurance is available in two primary forms: long term and short term Income... read more

Why Choose for Your Income Protection Insurance

The benefits of using are?

  • Free online quotes
  • Easily tailor and filter your quotes to find the best price and product
  • Apply online for your cover once you find your suitable cover
  • Honest friendly advice from our qualified advisors if required
  • We do not charge for arranging or advising on policies.

provides a comprehensive online facility to compare income protection policies from the leading insurance companies. These providers include, but are not limited to, Liverpool Victoria, Aviva, Legal & General, Friends Life, Vitaliy Life and Ageas. Our quick and user friendly quote engine allows you to easily change quotes so you can try different benefits, deferment periods, terms, etc.

In addition to being able to quote online you can contact our offices free of charge on 0808 1782 777 to receive honest and high quality advice from our fully qualified, friendly advisors. We do not 'hard sell' under any circumstance and are more than happy to email or post any information that you require.