While we all like to think that our jobs are safe, the truth is that anything can happen in the future. Being made redundant is just one of the problems that could crop up along with suffering illness or being unfortunate enough to have an accident. If any of these kept you from earning an income then you would struggle to maintain your lifestyle. However income protection insurance could provide you with a lump sum income each month which would be tax free.
As with all insurance policies, certain conditions do apply to all cover, so you do have to ensure meets your circumstances before buying. Exclusions which exist in all include being in part time employment, suffering from a pre-existing or ongoing medical condition, being retired or self-employed. Providers can put others in so you have to read and compare the wording of any insurance you are considering.
A standalone provider of income protection is the obvious choice when buying the cover. They will offer the terms and conditions in easy to understand plain English which makes deciding if you could benefit easy. As they do specialise in selling policies of this nature the provider will be able to back up their products with experience.
Income protection insurance would provide you with the money needed each month to continue living your current lifestyle if you did become unable to work. A policy would cover suffering from an illness or accident which would incapacitate you or if you should become unemployed through no fault of your own such as redundancy. Cover would begin after you had been incapable of working for a certain period of time. With the majority of policies this can be anytime from the 30th and up to the 90th day. Once a policy has commenced it would then continue to give you security of an income for between 12 and 24 months depending on the provider.
The cost of the premium for income protection insurance will vary and it can be quite a lot. This is why it is essential to get quotes from independent providers for the cover. Along with getting the cheapest quotes from a specialist you will also get access to the information you need to ascertain whether cover would be suitable.
It is a lack of information at the time of taking out a policy that has led to many buying cover that they could not claim on. This was highlighted in 2005 when the Office of Fair Trading received a super complaint from the Citizens Advice. High street lenders were handed fines and the Financial Services Authority made suggestions when it came to improving the sales techniques. While some changes for the better have been seen many more need to be made in the future and some firms sadly still continue to mis-sell.
It is important to remember that income protection insurance as a product is not at fault. The insurance itself provides invaluable protection - you just need to buy it wisely.
