David Hudson, director of a Manchester based insurance brokers, has been advising business owners, landlords, and employees alike to consider income protection when the unexpected happens, usually relating to ill-health.
According to The Guardian, 300,000 people have to stop working due to injury or illness every year, while one in four people fall into poverty after a long-term absence from work. The report went on to reveal that “your employer is obliged to give you statutory sick pay (SSP), but only for the first 28 weeks of illness. And at £85.85 a week, it is hardly riches. That’s equivalent to £4,464 a year, roughly one-sixth of the national average full-time salary of £26,500.”
David has been talking to Property Aspects about the precautions that can be taken to protect one’s income. But first he answered the question, why now?
“We live in very stressful times. People forget that stress is an illness and on average 400,000 people report that work-related stress is making them ill every year. Recently it was reported that nearly half of all UK carers have been made ill by money worries. Outside of that, sometimes viruses simply get the better of us, or accidents that can just happen at any moment.”
So what can be done to help protect your income?
“SSP is a starting point, but even if you qualify it is still can be a loss of over half your usual earnings. Plus that’s only for 28 weeks. Only a third of private companies offer sick pay, while the amount can be dependent on your position and amount of time with the company, and only 4% of UK companies pay full salary for six months, so there has to be more done.”
He continued: “One contingency that is always available is to save up. Put away a set amount of your earnings, say 10-20% or whatever you can afford, to one side, or go one step further and put it in a high interest ISA account. However, one of the most comprehensive ways to protect your family is definitely through insurance.”
David concluded: “With insurance there is a decent range of options open to you: there’s income protection insurance, critical illness cover, or life insurance, all of which can be tailored into personalised policies. Personally, I recommend income protection, as it provides a regular replacement income if you have to go on long-term sick leave for six months or more and pays up to 80% of your salary until you can return to work.”
If you would like more information on income protection insurance, critical illness cover and unemployment insurance cover please contact Buckland Harvester directly via Buckland Harvester at www.bucklandharvester.co.uk