Sick pay insurance

jimmyboy82

Ok, so I'm potentially looking into changing jobs, the issue being the company only has a statutory sick pay scheme, everywhere else I have worked has had sick pay paid at normal rates. 
I was wondering if anyone had used insurance to cover themselves if they had a large period of time off, say circa of 2 weeks?? Are these insurances worth the paper they are written on, or are there good comprehensive insurances out there. Just looking for a bit of feedback really.
Regards James

Marcon

jimmyboy82 said:

Ok, so I'm potentially looking into changing jobs, the issue being the company only has a statutory sick pay scheme, everywhere else I have worked has had sick pay paid at normal rates. 
I was wondering if anyone had used insurance to cover themselves if they had a large period of time off, say circa of 2 weeks?? Are these insurances worth the paper they are written on, or are there good comprehensive insurances out there. Just looking for a bit of feedback really.
Regards James

You won't be able to buy the sort of insurance you are considering (Permanent Health Insurance/aka Income Replacement or Salary Protection Insurance) for that sort of timescale. Such policies normally won't pay out until you have been off sick for an extended period - 6 months is typical - to avoid abuse/fake claims.

DE_612183

what not just stash 2 weeks pay equivalent into a savings account?

Sandtree

There are two different products... AS/ASU and PHI but both are sold under the term "Income Protection".

AS or ASU (aka PPI) is a short term insurance policy that excludes any pre-existing condition, its relatively cheap but it only pays out for 12-24 months tops (most are 12). The premiums will increase each year however and as many found in recent years, many policies became unrenewable if it was ASU (ie had unemployment) as every insurer stopped writing the product for new customers and some for existing customers, those that didn't quadrupled the price.

PHI is a long term product, unlike AS it will pay out until your specified retirement date if you become too ill to ever return to work. Its also a fixed premium so no unknown increases or 4x increases due to Covid. The average claim is over 6 years which means those with AS cover would potentially have gone 5 years with no income. It is notably more expensive to start with but you can potentially get cover for pre-existing conditions.

One of the pricing drives however is the deferment period... how long you have to be ill before it starts paying. 2 weeks would be very short and therefore expensive. Most deferments are measured in months rather than weeks but if you dont have savings/cannot cut back your expenses to make them stretch that far then expect to pay much more in premiums.

Successful claims on PHI are much higher than AS/ASU in part because you know up front if they are comfortable with your high blood pressure or not etc.

Anything sold as Income Protection online with a simple form will be AS or ASU

MalMonroe

Hi, first I'd think about the nature of the job. 

This is what Citizens Advice has to say - 

https://www.citizensadvice.org.uk/consumer/insurance/insurance/illness-insurance1/

And if you google something like - "sick pay insurance when you are employed" lots of info pops up. It will depend on which particular policy you decide upon (if you do decide to take insurance out). As with most other types of insurance, they do vary.

My cousin's husband is a self-employed builder and he once fell from a ladder, injuring his back and putting him out of action for six weeks. Thankfully, he was fully covered by his insurance so didn't lose out on any income but of course he was fully self-employed. It's worth it if you are self-employed to pay for the best insurance you can get.

If you are employed, though, you could shop around for the one with the best conditions and lowest premium - if there is such a thing.

Or you could try looking around for a job that does pay you when you have to be off sick.

I mostly worked in the NHS where I received full pay if I was off sick. The longer you work for the NHS, the longer sick period times you can be paid for. Beginners in the NHS now receive one month full pay and then two months at half pay.

I also worked in higher education where the sick pay was 6 months at full pay and the following six months at half pay (if needed) by the time I left after having been there for 10 years.

Obviously if you can get a job where you are paid if you can't work because you are ill, you won't need extra insurance. Unless you particularly want it, I guess.

Undervalued

MalMonroe said:

Hi, first I'd think about the nature of the job. 

This is what Citizens Advice has to say - 

https://www.citizensadvice.org.uk/consumer/insurance/insurance/illness-insurance1/

And if you google something like - "sick pay insurance when you are employed" lots of info pops up. It will depend on which particular policy you decide upon (if you do decide to take insurance out). As with most other types of insurance, they do vary.

My cousin's husband is a self-employed builder and he once fell from a ladder, injuring his back and putting him out of action for six weeks. Thankfully, he was fully covered by his insurance so didn't lose out on any income but of course he was fully self-employed. It's worth it if you are self-employed to pay for the best insurance you can get.

If you are employed, though, you could shop around for the one with the best conditions and lowest premium - if there is such a thing.

Or you could try looking around for a job that does pay you when you have to be off sick.

I mostly worked in the NHS where I received full pay if I was off sick. The longer you work for the NHS, the longer sick period times you can be paid for. Beginners in the NHS now receive one month full pay and then two months at half pay.

I also worked in higher education where the sick pay was 6 months at full pay and the following six months at half pay (if needed) by the time I left after having been there for 10 years.

Obviously if you can get a job where you are paid if you can't work because you are ill, you won't need extra insurance. Unless you particularly want it, I guess.

Generally quite expensive if you want the policy to cover you from day one of illness / injury.

Most people compromise by putting some money aside to "insure" themselves for at least a short period, then have insurance that kicks in after that, which is usually quite a lot cheaper.

SensibleSarah

I have illness income cover that only kicks in after 13 weeks but pays out until I can work again or until death. I have an emergency fund saved that would pay for the first 13 weeks if needed. 

Sandtree

SensibleSarah said:

I have illness income cover that only kicks in after 13 weeks but pays out until I can work again or until death. I have an emergency fund saved that would pay for the first 13 weeks if needed. 

PHI would normally have an age set at which it stops paying, normally around the age you intend to retire, as obviously then your pension kicks in