Income Protection

[iCraig]

I appear to be in a financial mood today and have a bit of a financial overhaul planned.

Does anybody here have Income Protection? Do you think it's worth it?

There's no plans for me to lose my job (AFAIK!) but currently at work we're completely changing the way we market ourselves and bring in money. Our cash flow needs improvement, and although we're so far coping ok with the recession, it might be prudent to consider the worse case scenario in 12 months time that if we screw our evolving into a leaner, better, more efficient company, that I have some sort of safety net.

I have reasonable savings (for someone my age I think) but I'd hate to eat into them if I lost my job. I'm not ashamed to say I've worked hard the past 5 years to first of all get the job I have, and use it to get a decent flat, fun car, awesome PC, countless gadgets etc. Flogging my treasured possessions and years of saving would be rather depressing if I struggled to find work. Unemployment with young people in the Midlands is rife and I can't ignore the risk that if I did lose my job, I'd be without work for longer than is comfortable.

Am I being paranoid? Is it better in those situations to simply sign on and keep actively looking for work to satisfy the JSA folk?

I'm quite lost with things like this and don't want to have a false economy of paying a monthly premium to something unncessary.

[Glaucus]

IMO dont bother. Most of the time they will weasel out of paying you.

Just stick what you would spend on that in a savings account.

[Del Lardo]

IMO dont bother. Most of the time they will weasel out of paying you.

Just stick what you would spend on that in a savings account.


Experience or hearsay? Friend of mine got mortgage protection, lost his job and 3 months to the day later the protection company starting paying out. All he had to do was prove that he had been made redundant rather than quitting/being fired.

[Glaucus]

hearsay but if you google there are loads of news articles and stuff on refused payments. But it must be like all insurance. A few good companies with a truck load of bad.

[iCraig]

Just stick what you would spend on that in a savings account.

That's nowhere near the same though, with savings you'd only get back what you put in, plus interest. Whereas the payout for the premium (for my quote anyway) is £800pcm. That's after putting in £20pcm. As you can imagine, after a year of saving the same amount, I'd get £240 as a safety net, assuming I was even able to save for a year before losing the job. :confused:

[Del Lardo]

remembers when £800pcm would keep a roof over his head and beer in his belly......

Also worth checking when the cover kicks in, do you have to pay in for x amount of time before they payout?

[Desmo]

My brother was made redundant earlier this year and his cover kicked in OK but he had to wait 3-4 months I think it was. Also one payment was refused because some of his paperwork arrived with them too EARLY :eek:

So yes, cover does work but like most insurances, they get away with paying the least amount possible so check all the small print very closely.

[Admiral Huddy]

IMO dont bother. Most of the time they will weasel out of paying you.

Just stick what you would spend on that in a savings account.


I agree.. Had one once, and I was made redundant. They got out of paying the full amount. I think about 50%.

Anyway, today I have a flexible mortgage with ING that I overpay each month into. Not only is it a big reserve in case of any incident but the sum is offset against the capital saving me interest and reducing the term long term.

I also keep 60 day notice account running for emergency. If i was off work or couldn't work, I have enough for well over a year and a half without working. A lot longer than some of these income protection schemes.

[Del Lardo]

I agree.. Had one once, and I was made redundant. They got out of paying the full amount. I think about 50%.

Anyway, today I have a flexible mortgage with ING that I overpay each month into. Not only is it a big reserve in case of any incident but the sum is offset against the capital saving me interest and reducing the term long term.

I also keep 60 day notice account running for emergency. If i was off work or couldn't work, I have enough for well over a year and a half without working. A lot longer than some of these income protection schemes.


All very well and good if you have had a good career for 10+ years and bought your house before it all went crazy but when you are still in your 20s and need £800+ to keep a roof over your head getting that kind of buffer is difficult if not damn near impossible which is where income insurance becomes useful.