Income Protection Insurance
With decades of specialist protection experience, Ward Goodman provides clear, independent advice on income protection insurance in the UK, helping you understand your cover options and choose protection that safeguards your income if illness, injury or redundancy affects your ability to work.
- Independent advice on income protection and income protection life cover
- Clear guidance on family income protection and insurance income protection options
- Free, no-obligation meeting at one of our Dorset offices or online
What Is Income Protection Insurance?
Income protection insurance is a type of cover that provides a regular, tax-free income if you’re unable to work because of illness or injury. It’s designed to replace a portion of your earnings (typically between 50% and 70%) and help you meet essential costs like mortgage or rent, bills and everyday living expenses while you focus on recovery.
Unlike a one-off lump sum, income protection keeps paying out at regular intervals until you return to work, reach your chosen retirement age, or the policy term ends, depending on the terms you choose. Because policies, waiting periods and benefit levels vary, independent advice can help make sure you pick the right protection for your situation.
How Does Income Protection Work?
When you take out an income protection policy, you choose factors such as the amount of income you want covered, how long you’re prepared to wait before benefits begin (the “waiting period”), and how long the policy will pay out (the “benefit period”). Once you’re off work due to illness or injury and the waiting period has passed, your insurer pays a regular monthly benefit to replace part of your lost income.
Premiums are usually paid monthly and are based on things like your age, health, occupation and the level of cover you select. Keep in mind that income protection doesn’t usually pay out for redundancy or voluntary unemployment, so it’s important to understand the scope of cover you’re buying before committing.
Are You Eligible For Income Protection Insurance?
Before you explore income protection insurance in more detail, it’s helpful to check whether you’re likely to qualify for cover. Eligibility criteria vary between providers, and income protection is not compulsory – but most insurers will assess your personal situation and circumstances before offering a policy.
- Be a UK resident and legally permitted to work here (some policies require you to have been registered with a UK GP for a period)
- Be aged at least 18 (and under the insurer’s maximum entry age, often around 59)
- Be employed or self-employed at the time you take out the policy and able to demonstrate a stable income
- Complete any health and lifestyle questions as part of your application
- Meet insurer-specific underwriting requirements based on your job, earnings and health status
What’s Included with Income Protection Insurance cover?
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Regular monthly income Pays a tax-free income if you’re unable to work due to illness or injury, helping cover everyday costs like mortgage or rent, bills and essentials.
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Flexible benefit period You can choose how long your cover lasts, with some plans paying out until you return to work, retire or reach the end of the policy term.
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Income replacement percentage Policies typically replace a portion of your earnings (often around 50-70%), providing meaningful support while you recover.
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Cover for a wide range of conditions Includes many illnesses and injuries that prevent you from working, including both physical and mental health issues.
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Optional extras and support services Some plans include features like rehabilitation support or tailored definitions of incapacity to suit your situation.
Important Things to Know
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Waiting or deferred periods apply Most policies have a waiting period between when you first stop work and when payments begin, which affects premiums and when you receive benefits.
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Doesn’t usually cover redundancy Standard income protection typically pays out only for illness or injury, not for voluntary unemployment or redundancy unless you add specific cover.
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Benefit levels and terms vary Different insurers offer varying percentages of income replacement, benefit periods and conditions, so it’s important to understand the terms before choosing cover.
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No cash-in value Unlike savings or investment products, most policies won’t have a surrender value - if you never make a claim, there’s usually no payout.
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Check exclusions and definitions Policies may have specific definitions of incapacity and exclusions that affect claims, so review details carefully.
Meet Our Income Protection Advisers
Our Individual & Family Protection Services
Income Protection
Helping protect your income if you’re unable to work due to illness or injury, with regular monthly payments designed to keep you financially stable.
Mortgage Protection
Ensuring your mortgage is covered in the event of death or serious illness, giving you peace of mind that your home is protected and your family’s future is secure.
Life Insurance
Providing financial support for your loved ones with cover that pays out a lump sum on death, helping protect mortgages, family income, and future plans.
Critical Illness Cover
Supporting you with insurance that pays a tax-free lump sum if you are diagnosed with a serious condition listed in your policy, helping protect your finances when you need it most.
Frequently Asked Questions
Income protection insurance can play a key role in your financial planning by providing a regular income if you’re unable to work due to illness or injury. Below we answer some of the most frequently asked questions to help you understand how it works, what it covers and whether it could be right for you.
What is income protection insurance and how does it work?
How much of my income can income protection cover?
How long does income protection pay out for?
When would an income protection policy start paying out?
Is income protection different from critical illness cover?
How much does income protection insurance cost?
Are self-employed workers eligible for income protection?
What illnesses or injuries are covered by income protection?
Can income protection cover change if my circumstances change?
Should I arrange income protection through a financial adviser?
The Process
Initial referral or inquiry
Whether you’ve been referred or inquired yourself, our team will reach out to you in a timely manner
Free consultation
We offer a no-cost, no-obligation meeting at one of our offices, or over the phone
Quote and setup
We’ll provide you with a tailored quote and when you’re ready, our tax advisors will begin services
Book a Meeting
If you would like to discuss further, please book a meeting with an experienced member of our team. Simply let us know when’s best for you and we will get in touch to arrange a suitable time.
Why Choose Ward Goodman?
Client satisfaction is paramount to us. We have a broad range of clients, and we endeavour to offer them the best tax planning service possible through continuous improvement and focus on doing things right the first time.
Experienced Advisors & Accountants
Our Dorset-based team can advise and support any size of business locally or nationwide.
Bespoke Financial Advice & Tax Planning Service Packages
Flexible, bespoke service covering all aspects of tax planning.
Access to a Full Team of Finance Experts
From our Financial Advisors to Pension Advisors.
Our Awards and Accreditations
Ward Goodman’s excellence in accounting and tax advice is validated by notable awards and accreditations within the UK financial industry.
AAT Qualified
Xero Certified
ICAEW Membership
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