Work After Lockdown

Returning to the workplace

Returning to the workplace during the current lockdown or a staged return. As the UK prepares for some workplaces to reopen, it has become quite the eye opening experience for many seeking enough money to survive.  Utilising the furlough scheme or DWP benefits, many current customers are thankful for the top up in funds from Income Protection Insurance.

Many providers have made widespread changes to accident and sickness cover in response to the coronavirus pandemic. At Protect Income Insurance we are working hard to help existing policyholders who are furloughed or vulnerable. Also helping and explaining this form of Income Protection to new customers.

What’s happening to Income Protection?

Income protection can cover mortgages, redundancy, loans as well as accident and sickness, either individually or as a package. Each policy type covers a range of general living costs if the policyholder can’t work. It will pay for one or two years, or until you go back to work, or until retirement or death, depending on your policy. The longer the cover, the higher the premiums.

On Wednesday 18th March 2020 many types of Income Protection were temporarily suspended and not giving quotes to the general public, including accident and sickness cover, and unemployment protection.

But now that market leading insurers have worked out what cover they can offer relating to COVID-19, Protect Income Insurance are now able to once again offer comparisons for Income Protection Insurance.

Accident and sickness cover revised

Insurers are continuing to offer accident and sickness cover, but they have reacted to the COVID-19 epidemic with a mix of new restrictions and assistance to those struggling financially.

Meanwhile, some have imposed restrictions on applicants who have or might have coronavirus, and others are considering excluding coronavirus-based claims. Many have increased the length of time policyholders will have to wait for a pay-out.

Here’s what you need to know about the changes to Income Protection policies for new and existing customers.

Six insurers have stepped forward with changes to their terms and conditions to provide cover for new applicants and those on furlough. Some of our providers have made minor changes for new customers and policyholders on furlough. Policies vary in the percentage of salary paid out.

Wait times for claims lengthened

All of the Income Protection providers are now accepting new customers for short term and long term Income Protection. However, claimants will have to wait at least four weeks until the policy pays out following a claim.

This as a small change that would only affect ‘a very small amount of people’. The premium and cover remain unchanged. People who are showing symptoms of coronavirus, undergoing tests or have tested positive are having their applications postponed. Now the vast majority of new customers will have to have held their policy for over four weeks before they can start to claim money.

Is Protection Insurance worth having?

If you’re buying Income Protection to cover the COVID-19 outbreak, it’s unlikely to pay out if you’re ill for a short while or self-isolating, depending on how long the pandemic goes on. Most policies, whether bought by an employer or by individuals, are designed for long-term absences, so they won’t kick in until after a waiting period.

By then, illness or self-isolation may be over and you could be able to return to work.

Only those policies that provide cover for a short period will pay out. This used to be either immediately or after a short time such as a week but such policies are no longer available to new customers.

What to look for before you buy Income Protection

If you’re hunting for any form of Income Protection policy. It’s vital that you understand when and under what conditions it will pay out. Our specialist advisors at Protect Income Insurance can help to find the best protection for you.

Ordinarily, Which magazine? Recommends every adult of working age should consider taking out Income Protection, as only a small number of employers will support their staff for more than a year if they’re off sick from work.

It usually pays out tax-free between half and seven tenths of your earnings, although there can be a cap.  It will only pay for as long as the policy lasts or until you can go back to work, whichever happens first.

Pay-outs are seldom immediate

Some short-term policies had previously paid from the first day. With others there can be a four-week wait, but long-term policies typically don’t start until at least 13 weeks.

While considering protection insurance. You should also take into account the fast-evolving government measures being set out to ease cash flow in response to the economic impact of the pandemic.

For help in finding the right cover for you simply complete our enquiry form.