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Income Protection – Statistics & Case Studies

Have you Thought about Income Protection?

We are surrounded by stories of people having cancer, heart attacks, strokes, car accidents, mental health breakdowns, to name a few major health situations which could happen to any of us at any time.

If you are working, what would happen to your monthly income if you suddenly lost your ability to work?

Would you be able to manage without your monthly income?

If you could not pay your mortgage, how long before you lose your home? How would you pay the food bills and which of your home comforts would you lose first? Can you and your family cope with this financial loss?

Income Protection will pay you a monthly, tax-free income if you are signed off work by your GP, and the monthly payment starts after your chosen deferred period.

UK Health Statistics

Did you know the following…

359,960 new cases of cancer are diagnosed in the UK each year.

163,444 deaths from cancer in the UK each year.

50% of people survive cancer for 10 or more years.

Every 7 minutes, someone in the UK will have a heart attack.

Every 12 minutes, someone in the UK will have a stroke.

600,000 men and 600,000 women are living with the after effect of a stroke.

Over 1.6 million men and over 1 million women are living with coronary heart disease.

4 out of 5 people with cancer may incur additional expenses of up to £570 a month because of their illness.

Source: Scottish Widows Protection Facts 2019/2020.

Income Protection – Statistics & Case Studies

Case Study 1:

Debbie was involved in a car accident which affected her ability to carry out her daily routine, including working as a full-time Head Chef.

As the main earner in her household, Debbie’s husband and 2 young children (aged 3 & 5) depend heavily on her monthly wage to pay the mortgage, bills and general household expenses.

Following her car accident, she contacted her insurance company and was offered emotional as well as physical support, including counselling and extra physio sessions. She very much needed this additional support as she struggled after her hospital discharge.

Debbie received 3 months sick pay, and the family had to use their savings for 3 months and the Income Protection policy started paying from then on. If they did not have the Income Protection Policy, the couple would have been in serious financial crisis.

When Debbie was advised to take out Income Protection, she was reluctant and waited over a year before she made her decision. She always felt that she would be making monthly payments for something she would never need.

After many discussions with her husband and Financial Adviser she eventually decided to take out the policy. If she had not made this decision, the family would have lost everything.

In this case, Debbie’s injuries were very severe after the car accident, and she could not carry out the manual duties required as a Head Chef. However, she did go back to a lower paid role and the Income Protection policy topped up the difference to the amount she had taken out, so the family had not lost anything financially.

“I am so lucky to have made the decision to take out this policy. Without any income, we would have lost our home and struggled to pay for food. I never thought this would happen to me, but you don’t know what’s around the corner in life. I now tell everyone to protect their income regardless of their situation.”

What would happen to you if you lost your income?

Case Study 2:

Many people take out Income Protection thinking they may need to claim in the event of a car accident, stroke, cancer or heart attack.

Max, a 46 year old father of 3, worked as a nurse on a busy hospital ward. He was working long hours, constantly surrounded by people from all walks of life with different health conditions and situations.

At home, he was busy with his young family; his elderly mother lived nearby with mobility issues and relied on his support. The long shifts in combination with his home life, affected his ability to carry out his very demanding job.

“When I took the policy out, I thought I might need it for a physical condition. I never imagined that I would be signed off work for mental health.”

Max was signed off work for stress and anxiety for around 6 months. He benefited from additional counselling sessions which were provided from the insurer to support his transition back into work.

“I am now back at work in a job that I love and really thankful that I took out the Income Protection policy when I did. Everyone who is working should look at protecting their earnings, it something you never think of when looking at insurance, what happens if you can’t work?”

Mental health awareness is all around us. In our lives, we are so busy that we never stop to think that we are suffering and just put it down to a busy life. Luckily, in this case, this was identified and supported from an early stage and Max is now able to manage his day to day living.

An Income Protection plan can support you through a mental health episode which can occur at any time in your lifetime.

Published January 2020

It is important to take professional advice before making any decision relating to your personal finances. Information within this article is based on our current understanding and can be subject to change without notice and the accuracy and completeness of the information cannot be guaranteed. It does not provide individual tailored advice and is for information purposes only.

Harish Hirani

Harish Hirani

With over 20 years of experience in financial services, Harish is a successful lending and insurance specialist. He commands a solid team of insurance advisors in mortgage lending, commercial lending, health insurance, life insurance etc catering to individuals, families, and business owners with several assets

Date: Jan 01 2020
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