Can you rely on sick pay when you’re ill?
Earlier this year, a report estimated that only 1% of UK workers aiming to return to work after ill health found a job within six months. Sick pay and government benefits are often not enough for people to live on. We look at the challenges for those off work and on long-term sick pay, and how critical illness insurance can give financial protection for workers.
How protected are UK workers?
In today’s uncertain economic climate, financial resilience is more important than ever. In a report by insurer LV, only 52% of UK workers have a sickness protection policy. This leaves a large percentage of the workforce without an adequate level of cover.
When surveyed, one in five employed workers were not aware of their sick pay arrangements. Meanwhile, just over half of those who thought they were entitled to sick pay realised they were only entitled to support for a few months.
Although sick pay is a valuable safety net, it’s not usually enough to help you pay your bills in the long term. As an example, the current weekly rate for Statutory Sick Pay is only £118.75 and this is provided by your employer for up to 28 weeks.
If you’re self-employed, then you could be even more financially vulnerable. 19% of self-employed workers state they would need to continue working if they’re ill or injured, compared to 12% of those who are employed. One in four self-employed people have savings of less than £1,000 and 29% could only manage for less than a month if they were unable to work. As a result, 17% would need to rely on their parents for financial support (LV report). See our blog Financial Protection for Your Mortgage When You’re Too ill to Work.
Is it worth having critical illness insurance?
The short answer is yes. Critical illness cover can be an essential financial safety net if you suffer an illness or injury and are unable to return to work quickly. One of the biggest benefits is the ability to pay your mortgage and household bills if the worst did happen.
Income protection works by paying out a lump sum benefit for specific illnesses or medical conditions. It’s different from income protection insurance, which pays out a regular ‘income’ that can be used to pay household bills while you are in recovery. Both types of policy are a useful form of financial support if you’re unable to work (terms and conditions will apply).
Get critical illness insurance
Whether you choose critical illness insurance or income protection, these forms of cover can give you peace of mind and financial security if you’re too ill or injured to work. There is a list of eligible conditions that are covered by critical illness insurance, so it’s important that you understand what your policy covers.
At Bubble Finance Hub, our team of experienced insurance advisers can talk you through the terms and conditions of different insurance policies. In some instances, we might suggest that a different or combined policy offers more benefits for your situation.
For advice on insurance policies for when you’re too ill to work, please get in touch to book an appointment.
As with all insurance policies, conditions and exclusions will apply.
Your home may be repossessed if you do not keep up repayments on your mortgage.
Thank you for reading our blog, Can you rely on sick pay when you’re ill?
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