Payment Protection vs Income Protection

mattk_180

Me and my partner are currently buying a house together and whilst we are both in considerably safe jobs and in relatively good health, I realise that nothing is guaranteed so want to take out some kind of insurance in case something was to happen and we lost some household income.


Looking online, the quotes and the cover for both seem similar, and neither give you cover for unemployment unless you pay silly amounts of premium each month.


So my question is, can anybody with experience in this give me a breakdown of the main difference as well as any recommendations as to what kind of cover I should be looking for and where the best place to get it might be?


Thanks in advance.

dunstonh

Looking online, the quotes and the cover for both seem similar, and neither give you cover for unemployment unless you pay silly amounts of premium each month.

They are not similar. Indeed, the differences are significant.

PPI is short term (usually 1 year with some going to 2 years).
It is not underwritten at point of sale (so they dont check medical details at start)
It can be cancelled by the insurer
The qualification requirements under a claim tend to be harder.

PHI is long term (it can go to a chosen age)
it is underwritten at point of sale (medical details asked)
It cannot be cancelled by the insurer (hence its name)

PHI is limited internet coverage as the comparison sites prefer to sell PPI. PHI is mostly arranged via IFAs.