The Importance of Insurance Against Loss of Income

Insurance Against Loss of IncomeIncome insurance is a valuable type of policy. Insuring against loss of income could provide you with an important financial buffer if you were to fall sick or have an injury. In this blog, we look at why you should consider income insurance and how this type of policy works.

In 2023, according to the Office of National Statistics, 2.5 million people in the UK were ‘economically inactive’ due to long-term sickness. In our everyday lives, most of us will experience periods of sickness and injuries at some point. If you need to take time off work due to a long-term illness or an injury, income protection can bring financial stability during a challenging time.

Imagine if you were signed off work for an extended period of time? This could be due to an accident or long-term sickness. Have you considered how you would fund your living costs? Would you have enough money to cope? What steps would you take if you were no longer able to work? These questions are vital when you are looking at how to protect your income.

How does income protection insurance work?

Also known as ‘income protection’, income insurance exists as a financial safety net for a worst-case scenario. This type of policy is designed to pay out regular support financially if you are unable to work due to any injury or illness. The cover replaces a percentage of your earnings until you are well enough to return to work. Payments are usually on a monthly basis and the amount you will receive will depend on your salary. So how does it work?

Income insurance usually covers up to 60% of your monthly income, allowing you to focus on your health. This type of cover can significantly reduce any stress and worry over financial matters, so you can pay your mortgage and bills.

An income insurance policy offers security to families at a time when they need it the most. There is often some confusion between income protection and critical illness cover. But income insurance serves a different purpose.

Insurance advice for loss of income

At Bubble Finance Hub, we have a team of experienced advisers who can explain how income insurance works. We will look at your current salary to see what percentage of your income you would receive should you make a claim.

Before we recommend a policy, we will talk you through how this works. We will also ask you a few questions to understand your personal situation. You might have dependants such as children, a vulnerable adult, or older parents living at home. It’s important that we get a full picture so we can select a policy that covers your needs.

Our team have decades of experience sourcing income insurance policies. As we have whole-of-market access to hundreds of policies, we can make suitable recommendations aligned to your occupation.

If you would like to find out more about income insurance, get in touch to speak to our advisers.

As with all insurance policies, conditions and exclusions will apply.

Thank you for reading our blog, The Importance of Insurance Against Loss of Income.

Bubble Finance Hub

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