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Choosing an Income Protection Policy
Insurance companies will usually offer a range of different options. The premium of a policy is likely to be an important consideration. Generally, the broader the scope of the cover, the greater the cost.
Choose how long to wait before a benefit becomes payable
You can usually choose from a range of deferred periods. You will probably wish to match this to your company's sick pay policy. For example if your company will pay an employeeu for six months, the benefit from the Income Protection policy starts after that time.
Choose how long you wish your cover to last
This is the maximum period for which benefit will be paid if you are too ill to work.
Choose if the premium pay should be fixed or could change
Guaranteed Rates - the amount is fixed in advance. This premium cannot be changed by the insurer, except in agreed circumstances (i.e to rise in line with inflation).
Reviewable Rates - the insurer can change the amount it charges in the light of factors such as policy lapses, interest rate changes and overall claims experience etc. This rate does not depend on individual claims that are made.
Employee occupation and medical history
The Income Protection policies will be underwritten based on the risk that the employee poses. During the underwriting process their occupation, medical history and any dangerous sports or past times that they undertake will be considered. Their GP may be asked to provide information on any past or current medical conditions.
Income protection is not payment protection. Payment protection insurance covers the repayments on a mortgage, loan or credit card if a person is unable to work due to accident, sickness or unemployment.
Income protection is not critical illness insurance. Critical Illness insurance pays out a lump sum if a person suffers one of a number of specific medical problems, such as a heart attack, cancer or stroke.
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Premier Healthcare Direct Ltd is regulated in the United Kingdom by the Financial Services Authority. Our regulated Firm number is 300707. Full details can be found on the FSA Register |
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