Income Protection

The Safety Net Nobody Thinks About Until It's Too Late

Picture this: you're going about your normal day when suddenly everything changes. An accident. A serious illness. A diagnosis you weren't expecting. And just like that, work becomes impossible.

Most of us have insurance for our cars, our homes, even our phones. But what about the thing that actually pays for all of it? Your ability to earn an income is almost certainly your most valuable asset, yet it's the one thing most people leave completely unprotected.

Let's talk about why that's a problem—and what you can actually do about it.

The Reality Check Nobody Wants to Hear

According to various studies, roughly one in seven people will be unable to work for six months or more at some point during their career due to illness or injury. That's not a small number. And if you think it won't happen to you, well, that's exactly what everyone else thought too.

The statistics are sobering. Mental health issues, back problems, cancer, heart disease, accidents—the list goes on. These aren't rare occurrences happening to other people. They're everyday realities that can derail anyone's life without warning.

Now, you might be thinking: "I've got savings" or "I'll just claim benefits if I need to." Both fair points. But here's the uncomfortable truth about each.

Why Your Safety Nets Might Not Be So Safe

Statutory Sick Pay currently sits at £116.75 per week if you're eligible. That's about £505 a month. Could you cover your mortgage or rent, bills, food, and everything else on that? Most people's answer is a resounding no.

Universal Credit is means-tested and might help bridge the gap, but it's not designed to maintain your current lifestyle. If you've got savings over a certain threshold or a working partner, you might not qualify at all.

Your savings are brilliant to have, obviously. But they weren't meant to replace your entire income indefinitely. How long would yours actually last if the money stopped coming in tomorrow? Three months? Six months? A year? And what happens when they run out?

Employer sick pay varies wildly. Some employers are generous; others stick to the statutory minimum. Either way, it's usually time-limited, and the reality is that serious illness or injury often takes longer to recover from than your sick pay lasts.

What Income Protection Actually Does

This is where income protection comes in, and it's genuinely one of the most underrated financial products going.

Here's how it works: you pay a monthly premium, and in return, if you can't work due to illness or injury, the policy pays you a regular tax-free income, usually up to about 50-70% of your salary—until you're able to return to work, or until retirement age, depending on your policy terms.

That money replaces your lost income, meaning you can still cover your mortgage, keep the lights on, feed your family, and maintain some semblance of normal life whilst you focus on getting better.

The key word there is "whilst you focus on getting better." Because that's what income protection really buys you: time and peace of mind. You're not lying awake at 3am wondering how you'll pay next month's bills. You're not forcing yourself back to work before you're ready because you've got no choice. You're not watching your savings evaporate or your debt pile up.

What Makes a Good Income Protection Policy?

Not all policies are created equal, which is where speaking to someone who actually knows the market inside out becomes invaluable.

The deferral period is crucial. This is how long you wait after becoming unable to work before the payments start. Common options are 4, 8, 13, 26, or 52 weeks. The longer you're willing to wait, the cheaper your premiums. But, you need to be realistic about how long you could actually manage without income.

The benefit period determines how long the policy will pay out. Some policies pay until you return to work, others until a set age like 65 or your state pension age. Again, longer cover means higher premiums, but also better protection.

The definition of incapacity matters enormously. "Own occupation" cover pays out if you can't do your specific job. "Any occupation" cover only pays if you can't do any job reasonably suited to your skills and experience. The former is more expensive but far more protective especially if you're in a specialist role.

Guaranteed premiums mean your monthly cost won't increase (except for inflation-linked policies). Reviewable premiums can go up based on claims experience across all policyholders, which could get expensive.

The Cost Question

Right, let's address the elephant in the room. Income protection isn't free, and for some people, it can feel like a significant monthly expense.

The cost depends on your age, health, occupation, whether you smoke, how much cover you want, and the policy terms you choose. Typically, you might pay anywhere from £20 to £100+ per month, though it varies considerably.

But here's the perspective shift worth considering: if you were suddenly unable to work, how much would it cost you per month in lost income? Probably several thousand pounds. The premium is a fraction of what you're actually protecting.

It's like any insurance—you hope you'll never need it, you resent paying for it when times are good, and you're profoundly grateful for it when times aren't.

Who Should Consider Income Protection?

Honestly? Pretty much anyone who relies on their income to live. But it's particularly important if you:

• Have a mortgage or significant financial commitments

• Are self-employed (no employer sick pay for you, unfortunately)

• Have dependents relying on your income

• Don't have substantial savings to fall back on

• Work in a physically demanding job with higher injury risk

• Have limited or no critical illness or life cover

Even if you think you're young and healthy and invincible, remember that most people who claim on income protection didn't see it coming either.

Getting It Right

The income protection market is complex, with dozens of providers and countless policy variations. What's right for someone else might be completely wrong for you, and vice versa.

This is genuinely one of those areas where professional advice isn't just helpful it's essential. A good adviser will look at your specific circumstances, explain your options in plain English, and help you find cover that actually fits your life and budget.

Oasis Prime, based in Wilmslow, has been helping people navigate these decisions for over 25 years. They understand that talking about income protection means talking about your fears, your family, and your financial reality and they approach those conversations with the seriousness and sensitivity they deserve.

The best time to sort out income protection was probably five years ago. The second-best time is now, before you need it.

The Bottom Line

Your income funds your entire life. Your home, your family's security, your ability to sleep at night without worrying about money. Protecting it isn't pessimistic or morbid, it's sensible.

Nobody plans to become unable to work. But plenty of people end up in that situation anyway, and the ones who've got proper cover in place are the ones who can focus on recovery rather than financial survival.

So maybe it's time to have that conversation. Not the fun conversation, admittedly. But possibly one of the most important ones you'll have this year.

Want to explore whether income protection makes sense for your circumstances? Get in touch with Oasis Prime for a no-obligation chat. Call or WhatsApp 07811 210404.