Income Protection Insurance in Leicester
Income Protection Insurance in Leicester
How it works
You choose three things, and together they determine both the cover and the cost.
The benefit amount. Usually between 50% and 70% of your normal earnings. Insurers cap it deliberately below full income so there is an incentive to return to work. On a personal policy the benefit is normally paid free of income tax.
The deferred period. How long you wait before payments start — commonly four, eight, thirteen, twenty-six or fifty-two weeks. This is the biggest lever on price. Match it to whatever sick pay and savings you actually have.
The benefit period. How long it pays for once a claim starts. Short-term policies pay for a fixed spell, often one or two years, and cost less. Long-term policies pay until you recover, retire or the policy ends, and are the more meaningful protection.
The part that matters more than the premium
The definition of incapacity decides whether you get paid.
Own occupation
— pays if you cannot do your own job. The strongest definition, and the one to aim for.
Suited occupation
— pays only if you cannot do your own job or anything similar you are suited to by training or experience.
Any occupation
— pays only if you cannot do any job at all. The weakest, and much easier for an insurer to decline.
A cheaper policy with an "any occupation" definition may pay nothing in exactly the circumstances you bought it for. We recommend own occupation wherever it is available and affordable, and we will explain plainly if it is not.
Who needs it most in Leicester
The self employed
Leicestershire has a large self employed population — owner-drivers and subcontractors around the logistics corridors, tradespeople, contractors, the small businesses that make up much of the county's economy. If you do not work, you do not earn, and there is no employer sick pay behind you. This is the group for whom income protection matters most and who buy it least.
Employees with limited sick pay
Many people assume their employer will support them indefinitely. Check your contract. Some offer six months full pay; many offer a few weeks, then statutory sick pay only.
Anyone with a mortgage and dependants
If your household could not maintain the mortgage on one income, or none, this is the gap.
Manual and shift workers
Occupation affects both price and terms. Manual occupations generally cost more and are more likely to be offered restricted definitions — which is precisely why the definition needs checking.
Income protection versus the alternatives
Critical illness cover
pays a lump sum on diagnosis of a specific listed condition. It does not pay for a back injury, stress, or a long recovery from an accident — none of which appear on the list. See our page on critical illness cover in Leicester.
Accident, sickness and unemployment cover
is usually short-term and includes redundancy, which income protection does not.
Life insurance
pays on death. It does nothing while you are alive and unable to work.
They are complements, not substitutes. Income protection covers the widest range of reasons you might stop earning.
Check what your employer already provides
Before buying anything, find out what you already have. It changes the shape of the cover you need, and sometimes the amount.
Contractual sick pay
Read your contract rather than relying on what you think it says. The range is enormous — some employers pay six months at full pay followed by six at half; many pay a few weeks then statutory sick pay only. That figure sets your deferred period.
Group income protection
Some larger Leicestershire employers — the NHS trust, the universities, the bigger manufacturers and head offices — provide scheme cover as a benefit. If you have it, you may need less personal cover, or none while you remain employed. Note that it usually ends the day you leave, so it protects the job rather than you.
Death in service
Common, and often confused with income protection. It pays a lump sum to your family if you die. It does nothing at all if you are alive and unable to work.
Bring your contract and benefits statement to the first appointment and we will work out the actual gap rather than insuring something twice.
Disclose everything
The most common reason a protection policy fails is not the small print. It is non-disclosure.
Tell the insurer everything about your medical history, including things that feel minor or embarrassing, and anything you have seen a GP about. A condition disclosed at application may simply be excluded or priced for. The same condition discovered at claim stage can invalidate the policy entirely — at the worst possible moment.
We will help you complete the application accurately. That is one of the more useful things an adviser does.
Getting the cover right
Cheaper is not better if it does not pay. We look at the definition of incapacity, the deferred period against your actual sick pay, whether the benefit is guaranteed or reviewable, and how the insurer has historically handled claims.
There is no obligation to proceed with anything we recommend.
Speak to a Leicester protection adviser
Tell us what you earn, what your employer would pay if you were signed off, and how long your savings would last. That conversation usually makes the decision obvious.
Call 0116 277 7536 or book a free consultation.
Cedar House, 3 Broad Street, Enderby, Leicester, LE19 4AA.
Common questions
What does income protection actually pay?
A regular monthly amount if you cannot work because of illness or injury, usually a percentage of your normal earnings — commonly between 50% and 70%. It is paid free of income tax on personal policies and continues until you return to work, the policy term ends, or the benefit period expires.
What is a deferred period and how should I choose it?
The waiting time between being unable to work and the policy starting to pay — typically four, eight, thirteen, twenty-six or fifty-two weeks. Choose it to match your sick pay and savings. If your employer pays six months' full sick pay, a twenty-six week deferred period costs considerably less than a four week one.
Is income protection worth it if I am self employed?
It is arguably more important. Employees may have contractual sick pay; the self employed generally have none beyond statutory support. If your household depends on your ability to work and you have no employer cover behind you, this is the protection that most directly replaces lost income.
Will it pay out if I can do some other job?
It depends on the definition of incapacity in the policy, and this matters more than the premium. Own occupation cover pays if you cannot do your own job. Suited occupation and any occupation definitions are more restrictive and cheaper. We recommend own occupation wherever it is available and affordable.
Do pre-existing conditions stop me getting cover?
Not usually, but they may be excluded or attract a higher premium. Insurers assess your medical history at application. Disclose everything fully — a non-disclosure discovered at claim stage is the most common reason a policy fails when it is needed most.
How much does income protection cost?
It depends on your age, occupation, health, smoker status, the benefit amount, the deferred period and how long the policy pays for. Choosing a longer deferred period is usually the single most effective way to reduce the premium without weakening the cover meaningfully.
Related
Important information
This is a protection policy with no cash-in value at any time. Cover is subject to underwriting and to the terms and exclusions of the individual policy. If you stop paying premiums, cover will end.
No cost, no obligation
Talk to a Leicester adviser this week
One conversation is usually enough to tell you where you stand. Send the form and an adviser calls you back, normally the same working day.
Book your free consultation
No cost, no obligation. Tell us where you are up to and an adviser will call you back, usually the same working day.