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Income Protection

When an individual first starts working full time they are generally only responsible for themselves.  As they progress through their working life they will often find their priorities will change and when they have a family their priorities will often change again. It is for this reason that a lot of people would take out family income protection insurance as this would provide them with a little added security in this situation. Their family income protection insurance will provide replacement income in their absence from work. Eventually most people get into a relationship, maybe get married and have children. Now they are responsible to others and many are looking at family income protection to protect them. While a single person may only have to worry about their own needs, those in a relationship, especially if they have children, have to think about others. They need to think about what happens if they get sick or in an accident and cannot work.

It is for these reasons that many are purchasing family income protection insurance. These plans will provide a regular income in the event the family’s main earner is unable to work, should you decide to take the plan on the main earner in the family. A family income protection cover plan can help with the standard needs of a family including food and paying the general household bills. It can also provide some level of peace to the entire family. A parent who becomes sick not only has the stress of the illness, they also have the stress of not providing for their family. The stress can be picked up by everyone else within the family. If they are able to get some income through a family income protection plan it may help alleviate a proportion of the entire family’s stress and worry.

All families are different, with some having multiple wage earners while others have one parent who may simply look after the children. In families where one person stays at home it can be difficult to maintain the lifestyle when the income providing parent becomes unable to work. Family income protection insurance may provide enough of a benefit that the stay at home parent, can still stay at home and look after the children and the income protection will provide the added security of providing some insurance should income into the household be effected by illness or injury.

While everyone imagines a happy life where nothing bad happens, this is more the exception than the rule. No one ever knows if they will be hit with a serious illness or involved in a debilitating accident. And it can be more devastating if others are dependent on us. Family income protection cover is one way to safeguard everyone’s future and provide for the everyday living expenses. For many businesses their most valuable asset is their employees. Without the staff nothing would get done, and there would be no production, sales, or income. This is why many companies are getting group income protection plans for when employees are unable to work due to illness or accidents. While an individual family income protection is for the benefit of the policy holder and his dependents, a group plan benefits both the employee and the company. When an employee is unable to work they are still going to need an income for their living expenses. A group income protection insurance policy can help employees by providing financial security during this time. Depending on the terms of the policy this income can last for a long time, sometimes up to retirement age if the person is unable to ever work again. While no one wants to think about that possibility, participating in a group income protection cover plan can reduce stress if this happens in the future. And many group income protection policies allow the employee to stay on the payroll so they can continue to accrue service and add to their pension plans.
While these policies certainly help employees, group income protection is also beneficial to companies. Losing a staff member can have a big impact on a business. First, they will need to pay the absent employee while at the same time finding someone to do their work. This usually means getting another employee to cover, which may mean overtime costs. Or they may have to hire another person, adding a new salary to the budget.

Group income protection insurance can ease the company’s burden by providing for these extra expenses. It can also help the company plan for future shortages so that they can keep costs down. These policies sometimes have additional benefits. Some include specialists qualified to give medical advice to the employees and also vocational counselling for those employees who want to return to work.

An employee’s absence affects their family and their employer. Group income protection cover is one way to lessen the impact on both and companies may want to consider adding it to their business plans.
With unemployment rates on the rise many people are looking to set up an income protection benefit and group income protection insurance. This type of plan can help protect individuals and families in the event of job loss due to accident, illness, or redundancy.  As people move along in their careers and their income increases they tend to take on financial responsibilities such as homes, cars and businesses. This is in addition to their financial obligations to spouses and children. It is important that they take stock of all of their responsibilities and determine if having an income protection insurance benefit in place is necessary. While some employees may feel fairly secure in their position and continuing employment, others are in jobs and industries that are seeing more and more layoffs. If a person is seeing peers and co-workers lose jobs due to redundancy or economics, then they may want to consider adding an income protection cover benefit to their portfolios
People may also become unemployed due to an illness or accident. Younger workers may want to pre-plan for these kinds of events by setting up an income protection benefit plan early in their work lives. They can generally get good coverage at lower rates than older, more established workers.

It is important to note that many companies will not pay out on an income protection insurance benefit claim if the policy holder had knowledge that they were losing their jobs prior to taking out the policy. This is why planning early is usually the best idea to ensure coverage is there when it is needed.

It is also important that a person takes out a policy that they believe best matches their future needs. This is especially true regarding the length of the payout. A person who is unemployed due to accident or illness may receive income protection cover benefit payments up to their expected retirement date. However, usually a person unemployed because of redundancy or layoff may only receive up to twelve months of payouts. Because policies can be very different, people may want to consult with their financial advisor early in their career to put together the income protection policy that is right for them.