If your income stopped tomorrow… what would happen next?

For many people, yes - especially if your lifestyle depends on your ability to earn.

The real question isn’t “Is it worth it?”
It’s:

“What would happen financially if my income stopped?”

If the answer is:

• You’d struggle to cover bills

• You’d need to use savings quickly

• Or you’d feel pressure to return to work too soon

…then income protection can be extremely valuable.

Why people choose it:

• Provides a regular monthly income if you can’t work

• Reduces reliance on savings or credit

• Gives you time and breathing space to recover

For business owners and self-employed individuals, it’s often even more important - as there’s usually no safety net in place.

This depends on your personal situation, but most policies allow you to cover:

Up to around 60% of your income

The right level of cover should reflect:

• Your monthly outgoings (mortgage, rent, bills)

• Your lifestyle costs

• Any existing safety nets (e.g. savings or sick pay)

A simple way to think about it:
You don’t need to replace everything - just enough to keep life running comfortably.

We typically help clients find the balance between:

• Adequate protection

• And keeping premiums sensible

Income protection doesn’t usually pay immediately.

Instead, you choose a waiting period (also called a deferred period), such as:

• 4 weeks

• 8 weeks

• 13 weeks

• Or longer

The policy starts paying after this period has passed

Why this matters:

• A longer waiting period → lower monthly cost

• A shorter waiting period → faster payout

Many people align this with:

• Employer sick pay

• Or how long their savings would last

This creates a smooth transition - so there’s no sudden drop in income.

This depends on how the policy is set up.

There are generally two options:

Short-term policies

• Pay out for a fixed period (e.g. 1-2 years)

• Lower cost

• Designed for temporary situations

Long-term policies

• Pay until:

  • You return to work

  • Or reach retirement age

This is typically the most comprehensive option

The right choice depends on:

• Your budget

• Your level of financial resilience

• How much long-term protection you want in place

Income protection covers a wide range of situations where you’re unable to work due to illness or injury.

This can include:

• Physical injuries (e.g. back problems, accidents)

• Illness (short or long-term conditions)

• Surgery recovery

• Mental health conditions (in many modern policies)

It’s not limited to “serious illness” only

That’s a key difference from critical illness cover.

As long as the condition prevents you from doing your job (based on policy terms), you may be able to claim.

Yes - this is one of the key strengths of income protection.

Unlike some other types of cover:

You can claim multiple times throughout the life of the policy

For example:

• You claim → recover → return to work

• Then later need to claim again

The policy can continue to support you.

Some policies also include:

• “Linked claims” periods (short gaps treated as one claim)

• Faster access if the same condition returns

In many cases, yes.

Most modern income protection policies include cover for:

• Stress

• Anxiety

• Depression

These are actually among the most common reasons people claim.

However:

• Cover depends on the insurer and policy terms

• Some exclusions or underwriting may apply

This is why advice matters - making sure the policy reflects your situation properly.

In most cases:

Payouts are tax-free

This is because:

• Policies are typically paid from your personal (after-tax) income

However, there are exceptions - particularly for:

• Employer-paid policies

• Certain business structures

We always ensure this is structured correctly from the outset, so there are no surprises later.

This is an important distinction.

Short-term income protection:

• Covers you for a limited period (e.g. 12–24 months)

• Lower cost

• Suitable if you have other long-term safety nets

Long-term income protection:

• Covers you until retirement if needed

• More comprehensive

• Designed to protect your full earning potential

Think of it as temporary cover vs full protection

For many professionals and business owners, long-term cover is often the more appropriate solution - but it depends on your wider plan.

This is an important one - because recovery isn’t always “all or nothing”.

Many people don’t go straight from being unable to work… back to full-time work overnight.

That’s where income protection can be really valuable.

Some policies include “proportionate” or “rehabilitation” benefits

This means:

• If you return to work on reduced hours or lower income

• The policy can continue to pay a partial income to top you up

For example:

• You return to work part-time

• Your income drops by 40%

• The policy may cover some of that shortfall

This helps you:

• Ease back into work gradually

• Avoid rushing your recovery

• Maintain financial stability during the transition