General FAQs

These are some of the FAQs we hear about income protection. We're always happy to explain how income protection works, or find out answers if there's something else you'd like to know. If these FAQs about income protection don't give you the information you need, call our friendly experts on 0800 0561 695.

Do I really need income protection?

It's hard to plan for illness or accidental injury when you're feeling fit and healthy. But how would you cope with the bills if you were ill or injured and couldn't work for several months at a time? In 2009, we paid over £28.5 million in claims to our customers - and our average claims are for periods of 106 months. That's over 8 years. Your outgoings don't stop just because your income does. That's why income protection is so important.

How much money will I need if I'm ill? How do I know how much you'll pay me?

You can use our cost of living calculator to work out how much you're spending now each month. It's easy to use, and it will give you an idea of your outgoings if you're unable to work due to ill health. If you can't work due to ill health, Income Protection Solutions will replace 60% of the first £25,000 of your gross earnings and 50% of the remainder, up to a maximum of £180,000 per year. To help you work out how much that would be, we've created a maximum benefit calculator for you.

What is a deferred period? Do I have to have one?

A deferred period is the amount of time that must pass between your first day off work and the point at which you will start receiving benefit if you make an eligible claim on your Income Protection Solutions policy. Deferred periods help you to make the most of any employer's benefits, or sick pay, before using your policy - and longer deferred periods help you to keep the costs down.

Our minimum deferred period is 4 weeks. You need to let us know as soon as you're spending time away from work due to ill health, even though your deferred period may be longer than this.

What's the difference between an Income Protection policy and an Accident Sickness and Unemployment (ASU) policy?

It's important to understand the difference and be confident that you've chosen the right policy. Your financial adviser can help, and our team will be happy to answer your questions - but this is a brief description that should help understand the differences between these two products:

Both policy types cover illness and accidental injury but an Accident, Sickness and Unemployment (ASU) policy also covers redundancy.
ASU policies are intended to cover periods of temporary unemployment and incapacity. They tend to have shorter deferred periods than Income Protection policies, but will generally only pay out for a limited time. An Income Protection policy can continue to pay until recovery, retirement or death.
ASU policies are usually cheaper than IP, but tend to have limited terms. After that point, new cover needs to be arranged - there's the possibility of it being declined or the premium raised. Income Protection policies typically run to retirement age and the premium remains the same throughout.

What sort of illnesses are covered by income protection?

We receive claims for mental illness (including stress and depression), musculoskeletal problems (relating to muscles and bones and including back pain), heart disease, cancer and a host of other illnesses and injuries - all of them unexpected. There's no way to predict some illnesses, and an accidental injury can happen at any time.

There may be medical exclusions on your policy, which means that some conditions will not be covered. We'll let you know what these would be after we've spoken to you and gathered information about your medical history. Terms and conditions apply and are available on request.

I thought I could claim income support from the government, if I'm ill?

You're right. The government pays employment and support allowance (ESA) to eligible claimants. But the amount you can claim is relatively low. For the first 28 weeks, you'll receive just £79.15 per week. From week 29 to week 52 of your incapacity, you'll receive £65.45 (based on a 25 year old or over), and after that, the long-term basic rate is just £91.40 per week (based on basic single person's ESA plus the work related activity component).

You should also check with your employer as they may pay you during sickness and this should also be taken into consideration. These payments may not be enough to cover your outgoings. Why not use our cost of living calculator, to see how much money you need each month?

Can anyone apply for income protection, providing they have a job?

We don't offer income protection to students, anyone who is unemployed (except housepersons), someone in the Police, or most Armed Forces personnel.

If I'm made redundant, will you pay me any benefits?

No. Income protection covers illness and accidental injury only.

What medical information will you need?

With Income Protection Solutions we need to understand your health to make sure that the cover you get is appropriate. This is called underwriting - it's the process we go through to assess the risk we take to give you cover. To gather the right information about your personal circumstances and medical history, we use Teleinterviewing. We've explained this in more detail on our What's a Teleinterview? page. This replaces the need for a medical examination. If you have questions about pre-existing conditions, you're welcome to call and ask us for more information.

Is there a lot of paperwork involved in making a claim?

We'll do as much of paperwork for you as we can. We may ask you to have a medical examination, and there could be some paperwork involved afterwards. But at every step of the way, you'll have the help of our friendly claims advisers. They're not in a call centre, you can ask them questions in confidence, and they're trained to deal with sensitive issues relating to medical situations.