Income Protection

Income Protection Cover: Safeguarding Your Mortgage and Financial Stability

Income protection cover is an insurance policy designed to replace a portion of your income if you’re unable to work due to illness, injury, or disability. For homeowners with a mortgage, this cover can provide vital financial security during unforeseen circumstances, ensuring that essential expenses like mortgage payments are maintained while you recover.

What Is Income Protection Cover?

Income protection cover pays a monthly benefit, typically up to 70% of your regular income, if you’re unable to work for a prolonged period. Unlike critical illness cover, which provides a one-time lump sum for specific conditions, income protection offers ongoing payments for as long as you’re out of work or until the policy’s end term.

The payments can be used to cover:

  • Mortgage payments.
  • Household bills and daily expenses.
  • Medical costs or rehabilitation needs.

Why Is Income Protection Important for Mortgage Holders?

Having a mortgage is one of life’s most significant financial commitments, and being unable to work can create a strain on your ability to meet those obligations. Income protection offers:

  • Mortgage Security: Ensures monthly payments are made, reducing the risk of arrears or repossession.
  • Financial Independence: Allows you to cover living expenses without relying on savings or support from family.
  • Peace of Mind: Reduces stress during recovery, knowing your home and finances are secure.

How to Choose the Right Policy

Selecting an income protection policy requires careful consideration of your needs and circumstances. Factors to assess include:

Waiting Period: Choose a deferral period that aligns with your savings or employer sick pay. Benefit Level: Ensure the payout amount is sufficient to cover your mortgage and essential bills. Policy Duration: Decide how long payments should continue—this could be until you recover or retire.

Want to know more? Speak to us today.

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THINK CAREFULLY BEFORE SECURING OTHER DEBTS AGAINST YOUR PROPERTY. YOUR PROPERTY MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON A MORTGAGE OR ANY OTHER DEBTS SECURED ON IT.

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A summary of our internal complaints handling procedures for the reasonable and prompt handling of complaints is available on request and if you cannot settle your complaint with us, you may be entitled to refer it to the Financial Ombudsman Service at www.financial-ombudsman.org.uk or by contacting them on 0800 0234 567.

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