Income protection still under scrutiny
- 10TH DECEMBER 2007
Income protection is just one of a family of protection policies that have caused concern since an investigation began into the sector in 2005. Mis-selling was found to be wide spread and the Financial Services Authority (FSA) handed out fines to several firms on the high street with the Office of Fair Trading subsequently referring the sector to the Competition Commission.
Although income protection was not the main cause of concern, this along with mortgage payment protection insurance is suffering from the bad publicity surrounding payment protection products. Sales in all payment protection products have dropped which is leaving many people without any form of security in case they should find themselves out of work.
If you were to come out of work due to an accident, illness or through involuntary redundancy then you would struggle to carry on living your lifestyle and meeting your essential outgoings. Income protection can be taken out to make sure that you would have an income each month to pay your outgoings and lifestyle expenses between 30 and 90 continuous days after the first day of your claim. Cover can continue providing you with a tax free income for between 12 and 24 months depending on providers, and the ethical British Insurance pay a tax free sum from day 30 and continues to pay you for up to 12 months.
Along with providing cheap income protection British Insurance makes sure that consumers understand what they are buying by giving consumers access to the key facts and exclusions which could mean a policy would not be in their best interest.
Reasons which could stop you from being eligible include only working part time, being of retirement age, suffering an ongoing illness or if you are self-employed but there can be others defined by the provider so it is essential that you check over the small print before you buy with a fine tooth-comb.
