Income Protection Insurance

Protect your pocket and your peace of mind with the Best income protection insurance policies on the market today. If you’re injured or ill, or if you’re made involuntarily unemployed, you can make sure you aren’t left out in the cold by using your monthly income protection benefits to cover your outgoings, like mortgage or rent payments, household bills, and food shops.

Income protection insurance does exactly what it says – it replaces your income if you can’t work due to illness, injury, or involuntary unemployment. But rather than “replacing” your income, it’s really about protecting it from unexpected loss.

Imagine you break your leg on a Sunday – would you be fit for work on Monday? Probably not! And you shouldn’t have to worry about money while recovering. That’s where income protection comes in. Also known as ASU, it provides monthly payouts to cover essentials like rent, bills, and household costs, so you can focus on getting back on your feet.

Why is income protection insurance important in the current UK job market?

Income protection insurance is always a good investment, but it’s especially worthwhile in the UK’s current climate. The cost of living crisis is still in full swing, and according to the Office of National Statistics (ONS), redundancies were on the rise by the tail-end of 2024. It’s been getting harder to find a new job in recent years, too, which means that in general, circumstances for people out of work have become pretty unstable. And in 2022, worker sick days rose to their highest rates since 2004!

With an income protection insurance policy in your corner, though, you don’t have to worry about any of that. If you lose your job or have to take time away because you’ve been injured or are sick, we’ll give you up to 65% of your monthly income for every month you’re out of work.

What’s the difference between income protection insurance, redundancy protection insurance, and critical illness insurance?

• Redundancy protection insurance covers you if you’re made redundant, providing up to £2,500 per month until you find a new job.
• Critical illness insurance pays a lump sum (up to £300,000, depending on the policy) if you’re diagnosed with a listed critical illness, helping with treatment and living costs.
• Income protection insurance combines elements of both, offering up to £2,500 per month if you lose your job involuntarily or need time off due to illness or injury.

Key Features of Income Protection Insurance

• Monthly tax-free payouts: If you need to claim on your income protection insurance policy, you’ll receive up to £2,500 a month (or 65% of your income), completely tax-free.

• Excess periods: This is the waiting time between claiming and getting paid. Most people choose a 30-day excess period, but the choice is yours.

Claim periods & policy terms: You can usually claim for up to 6 or 12 months, depending on the income protection policy. Policies typically exclude pre-existing conditions, substance use, self-harm, and voluntary unemployment. If you have complex health needs, a tailored policy may be best

Income protection insurance guarantees a monthly payout — 65% of your pre-claim income or up to £2,500, whichever is lower — ensuring you can cover rent, bills, and daily expenses while off work. This financial security provides peace of mind, whether you’re working or unable to due to redundancy, accident, or illness. Unlike state benefits, which can be unreliable, or savings, which may run out, income protection offers a consistent safety net when you need it most.

Income protection insurance is a lifesaver for salaried professionals, covering long-term sickness absence and involuntary redundancy alike. Statutory Sick Pay (SSP) sits at just £116.75 a week in 2025, which is often not enough — but income protection insurance can provide up to £2,500 a month to help you maintain your lifestyle if you’re unable to work due to illness or injury.

For the self-employed and business owners, unemployment cover is usually not included, but income protection insurance is still crucial. With limited financial support available, this insurance ensures you don’t face a pay cut if you’re too sick to work.

And if you’re in a high-risk job — like nursing or construction — income protection insurance is even more essential. In 2023/24, 604,000 workers suffered non-fatal injuries at work according to the Labour Force Survey, many needing time off. With the right coverage, you can focus on recovery without worrying about your finances.

You’ll be eligible for income protection insurance if you:

• Permanently reside within the UK;
• Are aged between 18-64;
• Work more than 16 hours a week;
• Have been in permanent, continuous employment for the last six months with the same employer;
• Are not subject to any disciplinary action or ongoing enquiry by your employer;
• Are not aware of any circumstances that might lead to you being made unemployed or becoming a carer;
• Are not currently off work or working reduced hours because of ill health.

Income protection insurance works like any other benefit policy. After purchasing it online or through a broker, you’ll pay a monthly premium to keep your cover active. Once set up, there’s an Initial Exclusion Period (IEP), usually around 120 days, during which you can’t claim for unemployment. After that, you’re covered for accidents, sicknesses, or job loss.

If you need to claim, contact your claim administrator right away. You’ll need to provide evidence — like medical records for illness/injuries or employer documents for unemployment. Once approved, you’ll receive monthly payments until you’re back at work or find a new job. If your benefit period ends before then, you’ll need savings or another plan in place, which is why opting for a longer benefit period can be worth the extra cost

Several factors can affect how much your income protection insurance costs, including:

• Your age (with higher premiums for older policyholders);
• Your job (for example, someone who works in a high-risk job like construction would pay more than someone who works a job that’s comparatively lower-risk);
• Your salary (this affects how much money you could claim a month, which affects what you have to pay to keep your cover);
• Your health (you might pay more if you smoke, for example, and pre-existing conditions will always be excluded);
• Your lifestyle (if you go skydiving on your weekends, for example, you’ll probably pay more than someone who doesn’t);
• The length of your excess period (with shorter excess periods costing more and longer ones costing less).

If you want an accurate estimate for what an income protection policy tailored to you might cost, it’s worth contacting a broker directly. You can give Best Insurance a call on 0330 330 9465 to get a quote today!

You can get income protection insurance from a range of brokers and insurers across the UK, but we’d recommend:

• Best Insurance: Income protection insurance is our bread-and-butter; we’ve got over a decade’s experience both broking income protection from the wider market and designing our own income protection insurance products, so you can rest assured knowing your income is in safe hands with us.

• Aviva: Aviva are very well-rated across the insurance market, and their income protection insurance policies are no different! They offer a wide coverage range and high claim payout rates, so they’re worth considering.

• Legal & General: With almost two centuries of experience in the insurance industry, Legal & General are a well-trusted provider of income protection policies that are suitable for many different needs.

• Vitality: Vitality focus a lot on the health and wellbeing of their policyholders in addition to offering comprehensive income protection coverage; they’re a great option if you’re looking for add-ons like discounted gym memberships.

LV=: LV has a very long history of handling income protection insurance and is a great choice if you’re looking for more out of your policy, for example if you want back-to-work support or career break options.

There are a few different ways to apply for income protection insurance, but before you start, your best bet would be sitting down to figure out exactly what you need from your policy. Have a look at your finances — your income and your outgoings — and make a note of how much you’d need to keep up with your obligations. That amount is the benefit amount you want to look for. You should also figure out how long you think you could rely on your savings for, because that’ll affect how long your excess period should be.

Once that’s done, you can either get in contact with Best Insurance through our website to get a quote, or you can give us a call on 0330 330 9465 and we’ll search the market for you. As part of the application process, you’ll have to answer some questions — your employment and medical histories are common lines of inquiry, as are questions about your lifestyle — and select your preferred excess period, but once that’s done, your policy should be set up for you.

To file an income protection insurance claim, the very first thing you should do is contact your claim administrator, whose contact details will be in your policy wording. The sooner you do this, the sooner your claim will be processed, so don’t leave it too long; ideally, you’d want to get a start when you’re first off work or made unemployed.

Your claim administrator will then take you through the process, explaining how to fill out your claim form, what to send to your employer (if applicable), what documentation they need from you, and anything else you might have to do to successfully claim.

Once that’s done, all you have to do is wait. Claims usually take about 30 days to be processed, but if your administrator is taking longer than you’d expected, it might be worth contacting your insurer to see if there’s anything you can do to hurry them along. If the delay is excessive or if you feel your claim has been denied unfairly, you can escalate the issue to the Financial Ombudsman Service (https://www.financial-ombudsman.org.uk/).

1. What does income protection insurance cover?

Your income protection insurance policy covers your income if you’re too sick or injured to work or if you’ve been made involuntarily unemployed. You agree on an amount you’d like to be paid if this happens — called a ‘benefit’ or ‘benefit amount’  — and if you find yourself unable to work, you make a claim. Your benefit will cover whatever you need it to cover, whether that’s your mortgage payments, your rent, your bills, or even your groceries.

2. How much income will I receive if I claim on my income protection insurance policy?

If you successfully make a claim on your income protection insurance policy, you’ll be paid out the benefit amount you selected when you first purchased cover. This will usually be up to either 65% of your income or £2,500.

3. Is income protection insurance worth it if I’m in the UK?

Yes, income protection insurance is worth the investment, even if you are in the UK. With an income protection insurance policy in your back pocket, you won’t have to rely on your savings, state benefits like Universal Credit (which often aren’t enough to live off of for long), or handouts from loved ones to keep your head above water in the event that you couldn’t work. Think of it like paying into your rainy-day fund; one day, you’ll need it.

4. Can I get income protection insurance if I’m self-employed?

Yes, you usually can get income protection insurance if you’re self-employed, but it’s rare to find full cover. For obvious reasons, unemployment cover is usually excluded from policies for the self-employed, though you’ll still be able to claim if you’ve had an accident or gotten too sick to work.

5. What is commonly excluded from income protection insurance policies?

Your standard income protection insurance policy will exclude:

• Unemployment if you’re the at-fault party (for example if you lose your job due to misconduct);
• Unemployment during your Initial Exclusion Period (IEP);
• Self-harm or drug abuse;
• Elective procedures (for example, cosmetic surgery);
• Pre-existing conditions (whether that’s medical conditions you had before the policy went live or a risk of unemployment that you knew about when you purchased the policy);

For a full list of what is included in your coverage and what isn’t, check your policy wording.

6. How soon can I claim on my income protection insurance policy?

If you’re claiming due to an accident or sickness, you can claim as soon as you like! For unemployment claims, though, there’s usually a period known as your Initial Exclusion Period (IEP) that you have to wait out before you can make a claim. If you try to claim for unemployment during your IEP, your policy may be cancelled.

7. How much does income protection insurance cost?

There’s no fixed price for income protection insurance, because so much influences how much you have to pay in premiums (including your age, your job, your lifestyle, and the excess period and benefit amount you’ve selected). Generally, you can expect premiums to be between £10-£100 a month, depending on who you are and what you need.