How Does Income Protection Work?
Income protection insurance provides you with a regular income if you’re unable to work due to illness, injury, or disability. Here’s how it works:
Choose Your Cover
- You select the amount of your income you want to protect, up to 75% of your salary.
- You can also decide how long you want the cover to last—until you recover, retire, or for a specific period.
Set Your Waiting Period
- This is the time you wait before payments begin, typically ranging from 4 to 52 weeks.
- Choosing a longer waiting period can lower your premiums.
Choose the Type of Premiums You Want to Pay
You have two options:
- Guaranteed premiums: Your monthly payment stays the same unless you change your cover.
- Reviewable premiums: Your payments stay the same for the first 5 years, then they may go up, down, or stay the same every 5 years.
Choose When Your Cover Ends
This is called the ceasing age, and you can choose any age between 55 and 70, depending on when you plan to retire or stop working.
Making a Claim
- If you’re unable to work, you submit a claim with medical evidence.
- Once approved, payments will start after the waiting period (4, 8, 13, 26 or 52 weeks).
Receiving Your Payments
- You’ll receive regular, tax-free income to help cover everyday expenses like rent, mortgage, and bills.
- Payments continue until you’re fit to return to work or until your policy term ends.
Returning to Work
- Some providers offer rehabilitation support to help you ease back into work when you’re ready.
Extra Benefits That Come with Your Income Protection Plan
Income protection does more than just replace your income when you can’t work—it also comes with a range of helpful extras at no additional cost.
Guaranteed Increase Option
You can boost your income protection by up to 20% every three years without having to provide any new medical details—up to a total increase of 100%.
Hospital Cash Benefit
If you end up in hospital for more than seven days during your waiting period, you’ll receive a daily payment to help cover additional costs.
Waiver of Premium
You won’t have to pay your premiums if you’re receiving income from your plan. Your cover continues as usual, and if you need to claim again later, you can.
Partial Benefit
If you return to work—whether full-time or part-time—but earn less than before, you could still get partial payments to help bridge the gap.
Relapse Benefit
If you go back to work but face the same illness within six months, your claim will restart immediately without having to wait through another deferred period.
Rehabilitation Benefit
Tailored rehabilitation and exercise programmes can help you regain strength and improve your recovery.
Overseas Benefit
If you move abroad to certain European countries and the UK, your income protection plan can still pay out for up to 13 weeks.
Occupation Change (for certain plans)
Switching jobs? Your plan stays with you no matter what role you take. If you’re made redundant, your cover remains in place until you’re back in work.
Continuation Option (for certain plans)
If you change jobs or your employment situation shifts, you can transfer your plan to a new one without needing a medical check.
Work Tasks Benefit (for certain plans)
If you can’t work for reasons other than illness or disability, your plan still offers reduced cover to help you manage.
Medical Second Opinion
If you’re facing a serious medical condition and want a second opinion, services like Best Doctors Second Medical Opinion or Helping Hand can provide access to world-renowned medical experts. These services can give you reassurance, additional treatment options, and expert advice at no extra cost.
Aviva Family Care
Aviva Care is a health and well-being service provided by Aviva. Aviva Care comes with all new protection policies and it’s free of charge.
When you take out a protection policy with Aviva, you become eligible to access four great benefits for no extra cost: Digital GP, Best Doctors Second Medical Opinion, Family Care Mental Health Support and Bereavement Support. Click here for more information.
Critical Illness vs. Income Protection: Which is Best for You?
Choosing between Critical Illness Cover and Income Protection depends on your needs and financial goals.
Critical Illness Cover provides a lump sum payment to help with immediate, short-term expenses if you’re diagnosed with a serious health condition. This can be useful for covering medical costs, paying off debts, or making necessary lifestyle adjustments.
On the other hand, Income Protection is designed to replace a portion of your income over the long term, ensuring you can continue to manage your day-to-day expenses if you’re unable to work due to illness or injury.
The good news is, you don’t have to choose just one. Combining both policies can provide a more complete safety net, offering financial support for both immediate and ongoing needs.
Want to learn more? Read our blog to explore the key differences and find the right solution for you.
Publisher: Source link
