Income Protection

Your ability to earn an income is one of your most valuable financial assets. But serious illness, injury, or disability can stop you from working — sometimes for months or even years. Income Protection Insurance is designed to provide a regular monthly payment if you’re unable to work due to illness or injury.

At J Finance, we help you understand how income protection works, why it matters, and how to choose the right cover for your lifestyle, career and financial commitments.

Income Protection Insurance provides you with a monthly income if you’re unable to work because of sickness, injury or disability. Payments usually continue until you return to work, retire, or until the end of the policy term — depending on the cover you choose.

Unlike Critical Illness Cover or Life Insurance, which pay out in specific circumstances, Income Protection focuses on your ability to earn and helps replace lost earnings over the longer term.

A sudden drop or loss of income can place immediate and significant pressure on your finances. Income Protection helps by:

Replacing Lost Earnings

It provides a regular monthly income so you can continue to pay your bills, mortgage or rent, and maintain your lifestyle if you’re unable to work.

Protecting Your Savings

Rather than dipping into savings or investments, cover helps preserve your financial cushion for other needs or emergencies.

Reducing Financial Stress

Having a reliable income in place during periods of illness or injury reduces stress — giving you more time to focus on recovery.

Supporting Long-Term Financial Plans

It helps you stay on track towards your financial goals, even when your capacity to work is impacted.

Here’s how a typical policy functions:

1. Choose Your Level of Cover

You select the percentage of your income you want replaced if you can’t work. Most plans offer up to a set proportion of your earnings, helping you maintain essential outgoings.

2. Decide Your Deferred Period

The deferred period (also called the waiting period) is how long you wait after becoming unable to work before benefits start. Common options range from 4 weeks to 12 months. A longer wait usually means lower premiums, but delayed pay-outs when you need them.

3. Policy Pays Out If You Can’t Work

If you’re unable to work due to illness or injury and meet the policy terms, you will receive regular monthly payments for the duration of your claim, up to the selected age or policy end date.

Income Protection products can vary. Common features include:

Short-Term Cover

Pays out for a fixed limited period — usually up to one or two years — if you can’t work.

Long-Term or Deferred Cover

Pays out monthly until you return to work, retire, or reach the policy’s maximum age (for example age 60 or 65).

Own-Occupation vs Suited-Occupation

Some policies define disability based on your own specific job (own-occupation), meaning you may receive benefits even if you can work in another role, whereas others look at your ability to work in a role suitable to your skills (suited-occupation).

Choosing the right structure depends on your profession, income needs and financial goals.

To calculate a suitable level of cover, consider:

• Your monthly outgoings (mortgage, bills, rent, childcare)

• Personal commitments such as loans or savings goals

• Other income sources such as sick pay or employer benefits

• Your long-term financial plans

At J Finance, we help you work out the right level of income replacement so you’re neither under-covered nor paying for more than you need.

Several factors influence how much Income Protection costs:

Age

Younger applicants tend to pay lower premiums because the overall risk of long-term sickness is generally lower.

Health and Lifestyle

Your health history, weight, smoking status and lifestyle habits all affect how insurers assess risk.

Deferred Period

A longer waiting period typically reduces premiums but delays benefit payments.

Type of Cover and Occupation

Policies with broader definitions of inability to work (e.g. own-occupation) or those covering higher income replacement usually cost more.

Policy Term

Longer term policies, or plans that pay until retirement age, can attract higher premiums.

We assess these factors to find solutions that balance protection and affordability.

Income Protection is ideal when:

• You rely on your income for everyday living costs

• You have a mortgage or significant monthly commitments

• You want to protect your long-term financial plans

• You’re self-employed, a contractor or a key income earner

• Your employer sick pay is limited or nonexistent

It acts as a financial safety net that keeps your plans on track when unforeseen health issues occur.

Income Protection protects you if you can’t work due to illness or injury — but it generally won’t cover:

• Redundancy or leaving work voluntarily

• Known conditions not declared at application that later lead to claims

• Self-inflicted injury or unlawful acts

• Short-term minor ailments not meeting the policy’s definition of inability to work

We explain exactly what a policy does and doesn’t cover before you commit, so you know what to expect.

Income Protection can be complex, with differing definitions, waiting periods, benefit structures and occupation rules. At J Finance, we:

• Review your personal and financial circumstances

• Explain cover options clearly and without jargon

• Compare competitive products from a wide panel of insurers

• Tailor solutions to your needs and budget

• Support you through the application and underwriting process

We aim to ensure you understand the protection you’re buying and feel confident you’ve chosen the right solution.

Here are some practical tips to help you make the best decision:

Start While You’re Healthy

Premiums are generally lower when you apply earlier in your career and in good health.

Understand Your Work Definition

Check how the policy defines inability to work — own-occupation cover may be more suitable if your job is highly specialised.

Choose Your Deferred Period Wisely

Balance affordability against how long you could manage without income before benefits start.

Consider Other Protections

Think about how income protection works alongside life insurance and critical illness cover as part of a wider protection plan.

Income Protection provides a vital safety net for your family and finances, helping you stay secure when illness or injury prevents you from working. At J Finance, we’re here to help you choose the right policy with confidence.

📞 01635 521300
📧 contact@jfinance.co.uk