Income protection Ins

creativehome

I have income protection ins for self employed. Is this worth doing or should I save the money instead?

DullGreyGuy

Income Protection is the marketing name for 2.5 different products... ASU/PPI and PHI (which also has a lite version). The two are very different both in cost and quality of cover. 

Is it worth doing? Well how old are you? If in 12 months time you became ill to the extent that you will never be well enough to work again would you have been able to save enough by then to maintain your lifestyle and pension contributions until your planned retirement date? If yes then you have no need for insurance, if not then you have a need and it then comes down to if the quotes make it economical in your mind or not 

Personally, PHI is the most important non-compulsory insurance alongside contents insurance but others would rather enjoy the monies and hope the risk doesnt materialise 

Weighty1

Even if you saved £100/month for 5-years you'd only have £6,000 (plus interest).  How long would that last you?  Bear in mind that on long-term income protection plans the average length of claim used to be just over 6-years, how long would it take you to save that amount of money AND what would you do if you became ill before you'd managed to save it?

For most people, whether self-employed or employed, income protection should be the first insurance the look at because for most people their income underpins their whole lifestyle.  Unless you have a high earning partner/spouse or a wealthy family who could support you long term then it's likely that you are the same.