Income Protection - What is it?
An Income Protection plan is designed to pay out a regular, reduced income in the event you are unable to work due to an accident, illness or in some circumstances made redundant.
Some policies will continue to pay a regular reduced income if you are unable to return to work up until the end date of the policy which is typically your normal retirement age.
This type of plan is quite often seen as the foundation of any financial planning.
Who is it for?
This type of plan is designed for anyone whom is working (employed or self-employed). It’s worth pointing out that even if your employer provides sick pay, it is unlikely to last for longer than twelve months and so ongoing protection is essential. Plans can be adapted to fit in with any existing protection you might have.
Important Information to Consider
No policy will ever match your basic income. The most it will cover is up to 65% of your basic income.
The longer the deferred period when making a claim, the cheaper the policy is. Generally people chose a 3 month deferred period whilst most self-employed clients take a 4 week deferred period. Day 1 cover is also available. It all comes down to your budget.
The cheapest policies generally pay a nominal amount for a 12 month period only.
Making a Claim for Redundancy
You cannot be under notice of redundancy when taking out the policy.
Self-employed people cannot claim for redundancy.
As Independent Financial Advisers we can help you find the plan that best meets your requirements.
The plan will have no cash value at any time and will cease at the end of the term. If premiums are not maintained, then cover will lapse.