Protection guide
What is income protection?
Income protection is designed to pay a regular income if illness or injury stops you from working and you meet the policy definition. It can help replace part of your earnings while you recover.
The basics
The policy replaces part of your income if you cannot work because of illness or injury.
MoneyHelper explains that income protection insurance can pay a regular percentage of your income if illness or injury prevents you from working, subject to the policy terms.
Unlike critical illness insurance, it does not usually require a specific listed diagnosis. The claim is based on whether you meet the policy's definition of incapacity.
Benefit limits are designed to replace part of your income, and the amount available depends on insurer rules, occupation and earnings.
Benefit amount
The level of cover should reflect the income your household actually needs.
Insurers normally limit the maximum benefit to a proportion of pre-claim earnings. The exact percentage varies by provider and product.
Essential household costs
Mortgage or rent, utilities, food and other regular commitments help frame the level of income that needs protecting.
Employer sick pay
Workplace benefits can reduce the amount of private cover needed or influence when it should begin.
Savings
Accessible savings can help bridge a short gap before benefits start.
Other income
A partner's earnings, rental income or other resources can affect the amount of cover required.
Deferred period
The policy does not normally start paying immediately.
The deferred period is the waiting period between becoming unable to work and the income-protection benefit starting.
Shorter deferred periods usually mean the insurer may start paying sooner, but can also make the policy more expensive. The right period often depends on employer sick pay and cash reserves.
If your employer pays full salary for three months, a policy starting after one month may duplicate cover you already have.
Definition of incapacity
The claim definition is one of the most important parts of the policy.
Income protection policies can use different definitions to determine whether you are unable to work. The exact wording varies by insurer and occupation.
Own occupation
Generally assesses whether you can perform your own occupation, subject to the insurer's wording.
Suited occupation
May consider whether you can perform another occupation suited to your education, training or experience.
Activities-based definitions
Some policies use functional or activities-based tests instead of an occupation-based definition.
Occupation risk
Your occupation can affect the premium, benefit terms or type of cover available.
The definition of incapacity, exclusions, deferred period and maximum claim period can materially change the quality of cover.
Claim period
Some policies can pay for years; others have a shorter maximum claim period.
Long-term income protection can potentially continue paying while a valid claim continues, up to the policy's maximum age or term. Short-term income protection may limit each claim to a set period such as one, two or five years.
The trade-off is typically between cost and the length of financial protection provided.
A household may be able to absorb several weeks without income but struggle significantly if earnings are lost for years.
Choosing cover
Compare the structure of the policy, not only the monthly premium.
Benefit amount
How much income could be paid each month?
Deferred period
How long would you need to fund yourself before a claim starts paying?
Claim duration
Can the policy pay long term or is each claim capped?
Incapacity definition
What exactly must happen before you are treated as unable to work?
Indexation
Can the benefit rise over time to help protect against inflation?
Guaranteed or reviewable premiums
Understand whether the insurer can change the premium under the policy terms.
If replacing existing cover, do not cancel the old policy until the replacement has been fully underwritten, accepted and put in force, and you understand any differences in terms and exclusions.
Protection advice
How long could your household manage without your income?
A protection review can compare your sick pay, savings, household commitments and occupation with the level and structure of income protection available.
Book a conversationThis guide is for general information only and is not personal protection or financial advice. Income-protection policies vary by insurer, occupation, underwriting, incapacity definition, deferred period, claim duration and exclusions. Content checked against current MoneyHelper guidance on 16 September 2026.