Income protection insurance

DAR999

Hi

I know a lot has been said in recent years about this kind of insurance, but is any aspect of this worth still having (ie are there any reputable firms out there that will actually pay out in the event of any "valid" claim).

I am in full time employment, and have a good savings buffer should the worst happen. That said the economic conditions are not great so if the worst happened it could take a while to get the right job.

So can anyone recommend any good companies/policies based on real practical and positive experience. I dont expect a company to pay out if i dont meet the qualifying criteria but equally I do expect them to pay if I ever were to qualify - and not have the company try and wriggle out of this.

Any advice or help appreciated.

Many thanks, David

dunstonh

I know a lot has been said in recent years about this kind of insurance, but is any aspect of this worth still having (ie are there any reputable firms out there that will actually pay out in the event of any "valid" claim).

Income protection yes. Payment protection masquerading as income protection less so. Which type is it that you have been reading about?

So can anyone recommend any good companies/policies based on real practical and positive experience.

Any local IFA or independent mortgage broker and some whole of market mortgage advisers.

ACG

I think you are possibly mistaking Income Protection with PPI.

Nobody on here can recommend. There is 1 company i tend to use that releases claim statistics for both sick payouts and unemployment payouts. surprisingly the MPPI company i use has paid out 85% of claims, which to me is a pretty good statistic.

Best bet is to see an advisor.

DAR999

Hi

Maybe I got the naming not quite right (?) I havent read much up in this area but pereceive there have been lots of negativity in this space around schemes not paying up when people try and make claims. I would expect to read the small print so not looking to pull a "fast one" but if I had a genuine claim then I would expect them to pay out within a reasonable period. Essentially looking for a reliable scheme that would provide some form of insurance should I not get paid for a while. Wanting to get behind the positive marketing spin with people's real world experiences of specific schemes/companies. So any feedback along those lines would be appreciated.

Thanks David

kingstreet

If you can tell us what you want to protect against, how much of your income you wish to protect, how long your employer pays you in event of sickness/disability and how long you want the cover to run for, we could tell you what kind of product you need and how it works...?

ACG

In terms of you not being paid for a while - do you mean because of sickness or redundancy or both?

dunstonh

I havent read much up in this area but pereceive there have been lots of negativity in this space around schemes not paying up when people try and make claims.

Proper income protection (PHI) has excellent claims stats. Payment protection (PPI) has pretty awful claims stats in general.

You havent indicated that sort of income protection you are after.

DAR999

Hi

I am primarily after protection should I lose my job. Whilst there is nothing to suggest this is going to happen I work in a earlish-stage company that is preprofit and in the current climate investors can be kind of fickle - so looking for some protection if they go cold at some future point. Probably looking to cover something in the range £1000-2000/month. Cover to pay for 12-24 months in event of a claim, if I cant find something after say 3-6 months should the worst happen. Sickness cover would be a optional extra in my thinking - i believe that the company would pay full salary for 20days, half pay for the next 20days, and then statutory sick pay.

I presume any claim would be dependent on signing up to JSA... and continuing with this throughout the period of any claim. Also how much pressure is there to take on any job regardless of what it is (ie even if it is a completely different job on a completely different salary)....

Hope that gives people enough information.

Thanks David

dunstonh

I am primarily after protection should I lose my job.

in which case you dont want income protection. You want payment protection. Although there are some income protections that offer an unemployment cover bolt on (combines a PHI policy with a unemployment policy but packages it as a single plan).

I presume any claim would be dependent on signing up to JSA... and continuing with this throughout the period of any claim.

Effectively, yes.

Also how much pressure is there to take on any job regardless of what it is (ie even if it is a completely different job on a completely different salary)....

The insurers will check with what efforts you make to get a new job and if you are not making efforts are being too picky, they can reduce or remove the benefit. However, that only tends to happen on larger amounts which have been paying out for a longer period.

ACG

There are a few options then:
- ASU (Accident Sickness Unemployment cover) - This will pay out for either 12 months or 24 months depending on the contract. http://www.defaqto.com/star-ratings/find-product/mortgage-payment-protection-insurance/5

- Unemployment Cover and Income Protection - The unemployment part will pay out for 12-24 months, the income protection will cover you until your sleected retirement age. There are far too many companies i could list here as it would be the income protection companies and unemployment cover companies, but if you have a look on that defaqto site (link above) it could be a good start.

- The last option is a policy which combines the 2. There are only a few companies that do this that im aware of. Liverpool Victoria, pruprotect and Nationwide. Im sure there are oher companies but none that i have come across.