Income protection insurance

Frequently asked questions

Living Costs Protection

What happens if I stop working or I’m made redundant?

If you’re unemployed or working fewer than 16 hours a week immediately before your illness or accident, you won’t be able to make a claim on your Living Costs Protection policy.


What if I go on adoption/maternity/parental leave?

If you're ill or injured during the first 12 months of your leave, we'll treat your Living Costs Protection claim as though you're still working.


Can I claim if I move to another country?

There may be limits on your Living Costs Protection policy if you move to a different country.

We’ll pay out your benefit if you move to one of the following countries: Australia, Austria, Belgium, Bulgaria, Canada, Channel Islands, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Gibraltar, Greece, Hong Kong, Hungary, Ireland, Isle of Man, Italy, Latvia, Lithuania, Luxembourg, Malta, Netherlands, New Zealand, Norway, Poland, Portugal, Romania, Slovakia, Slovenia, Spain, Sweden, Switzerland, UK and USA.

If you move anywhere else and need to claim, we'll only pay out your benefit for a maximum of three months.

If you later move back to one of the countries on our list and you're still unable to work, we’ll start paying your benefit again.


Can I claim if I’m made redundant?

No, Living Costs Protection doesn't cover loss of income because of redundancy. It only covers you if you’re unable to work because of illness or accidental injury.


Do I need to pay tax or national insurance on any benefit you pay me?

No, you’ll receive the full amount of benefit shown on your Living Costs Protection policy schedule if you make a successful claim. No deductions will be made for tax or national insurance.


Am I eligible if I have multiple occupations?

Yes, you’re eligible for Living Costs Protection. However, the total amount of hours you work across all jobs combined must be more than 16 hours per week. You need to be unable to do both/all occupations in order to claim.


Am I eligible if I’m on a 0 hour contract?

Yes, you’re eligible for Living Costs Protection. However, the average amount of hours worked must be more than 16 hours per week.


Am I eligible if I’m self-employed?

Yes, you’re eligible for Living Costs Protection. However, you must work 16 or more hours per week.


Can I have more than one policy?

No, you can’t have more than one Living Costs Protection policy. You can only have one policy per person unless you’re increasing your cover under the Life Change Benefit option.


How do I decide what deferred period to take?

With our Living Costs Protection policy, you can choose to wait 4, 8, 13 or 26 consecutive weeks before we starting paying the benefit to you. This is known as a deferred period.

To decide how long this deferred period should be, consider how long your employer would pay you if you’re off sick or how long you could manage if you need to rely on other ways to pay the bills, such as your savings.

If you receive sick pay from your employer, you may want your Living Costs Protection benefit to start being paid only when your sick pay stops or reduces. So, if you get three months company sick pay, your deferred period would be three months long.

The longer the deferred period you choose, the cheaper your monthly premium is likely to be.


How do I decide when I want my policy to end?

Living Costs Protection is designed to cover you while you’re working. So, you may wish to take the cover until your planned retirement date.

If you’ve taken out cover to make sure you can always pay a long-term financial commitment, like your mortgage, you may want the cover to end when this financial commitment ends. For example, the end date of your mortgage.


How do I decide how much benefit I need each month?

Consider how much money you’d need to pay your bills and expenses each month if you couldn’t work. 

Living Costs Protection isn’t designed to cover 100% of your lost earnings. It’s meant to help you continue paying your essential bills and outgoings, like rent or mortgage payments, utility bills or food, while you focus on getting better.

If you take out Living Costs Protection directly with us, we won’t be able to give you advice and we’ll only be able to cover up to 90% of your net monthly income, up to a maximum of £1,500 per month.   

If this isn’t enough to cover your lost earnings, you may want to consider an Income Protection+ policy. 

You can apply for Income Protection+ or Living Costs Protection through a financial adviser. If you don’t have a financial adviser, you can find one near you at unbiased.co.uk. 

Find out more about the differences between Living Costs Protection and Income Protection+.


Do I get a payout at the end of the policy if I don’t make a claim?

No, our Living Costs Protection has no cash in value at any time. The policy will only pay out if you’re unable to work because of illness or injury.

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