Income protection insurance policies can individually cover your income or an indebtedness such as a rent or a mortgage, or a combination of these if you are unable to work because of illness, accident or you become unemployed. Some income protection insurance providers allow you to vary the type of income protection insurance cover, so that you can choose; just accident and sickness, or just unemployment cover for example.

Most income protection insurance policies stop paying out after a set period, normally 12 months although some income protection insurances pay for only six months.

Income protection insurance policies aren’t simple to understand and contain a host of terms, conditions and exclusions. You need to read the income protection insurance policy document carefully to ensure to understand exactly what you’re covered for, and more importantly what’s not covered.

The broker who sells you an income protection insurance policy should, in the key features section, explain the important cover details and draw your attention, in the policy wording to important or unusual exclusions. They should also make sure that the income protection insurance they sell you is suitable for your needs. However, be aware; many income protection insurance providers are failing to do this.

When your income protection insurance starts you normally have to wait for 120 days before you are eligible to claim. For example, in most income protection insurance policies you can’t claim for unemployment until you’ve had the policy for four months. With accident and sickness you can normally make a claim as soon as the income protection insurance policy starts.

Once you are eligible to claim, you normally have to be sick or unemployed for 30 days before you receive any money. However, some income protection insurance polices will back date the benefit to the first day of your claim. This is known as back-to-day-one cover. Claims as a result of medical problems that you have had or were treated for in the last year won’t normally be covered under an income protection insurance policy. This could mean that your claim will be turned down if you are unable to work due to an existing condition.

Under the insurance code income protection insurance providers have a duty to ensure their income protection insurance is suitable for your needs and so it is essential that you disclose anything that you think could affect your income protection insurance cover. Before you can claim for unemployment under any income protection insurance policy, you normally need to be in full-time work for six months. There can be different requirements if you are on a fixed term contract or self-employed. If you work part-time you normally need to be employed for 20 hours per week to be able to qualify for income protection insurance cover.

Always make sure you are eligible for cover when you take out an income protection insurance policy