As the name suggests this type of insurance is designed to protect your income, but what does that entail? Basically if you are unable to work due to incapacity brought about by illness or injury then the insurance policy will replace a proportion of that income to enable you to meet your commitments.
Usually you will have to wait for a period of time before the benefits of the insurance policy will start (known as a deferred period), this can be anything up to 12 months. You may have provision from your employer to cover you in the short term, this type of policy is generally designed as a long term solution.
Statistics from the Office for National Statistics published in December 2016 indicate around 2.47 million individuals in the UK are claiming Employment and Support Allowance, the benefit for those unable to work due to incapacity. (source: www.ons.gov.uk)
If you would like to see if you should be looking at an income protection policy then give us a call on 020 3355 4841 or contact us here.
Life insurance plans typically have no cash in value and will cease at the end of the term. If premiums are not maintained then cover will lapse.