Illness and injury insurance explained

When you’re feeling fit and well, it can be hard to imagine a time that you may be too ill to work. Our research has shown, that the average 30-year-old male has a 32% chance of being off work for one month or more because of illness or injury, rising to 42% for a 30-year-old female, showing the importance of planning ahead to protect your income.

So, if you plan ahead you could be eligible for an insurance pay out that helps cover bills and essential living costs if you’re off sick.

In this article we explain how Illness and Injury Insurance works while you can’t, and the key considerations of this type of protection policy.

Legal & General Injury and Illness Insurance is available from selected partners.

What is Illness and Injury Insurance?

Illness and Injury Insurance, sometimes referred to as income protection, is a type of insurance policy that offers financial support when you can't work due to injury or illness.

Protecting your salary with insurance can help minimise the financial impact if you’re incapacitated. If a valid claim was made, the monthly benefit could be used to help pay your rent or mortgage, and bills and childcare costs while you’re off work, allowing you to focus on getting better, rather than worrying about the financial implications.

Why do I need illness and injury insurance?

If you are employed and can’t work due to illness, injury, disability or an accident, you may be able to claim Statutory Sick Pay (SSP). However, this benefit may not cover all of your outgoings, especially if you are the main earner in your household.

Your employer may also pay you contractual sick pay, meaning that you could receive some or all your regular salary when off work sick. While this gives some peace of mind, it is possible that your entitlement to contractual sick pay and SSP could end before you are able to return to work.

It is important to check your entitlement to contractual sick pay before you apply, so you can make sure that this is the right cover for you.

Why cover your income if Statutory Sick Pay is designed to financially help when you’re off work? Crucially, SSP only pays out a maximum of £96.35 per week for up to 28 weeks, so if you’re completely reliant on SSP, it’s likely not going to be enough to cover your utility bills, rent or mortgage and general living costs – especially if you’re off sick when payment of the benefit ends.

Our research has shown that the average household saves approximately £200 per month, which means that it would take 14 years for them to save their gross annual salary. Illness and Income insurance can help you feel financially secure in the event of illness or injury.

Insuring your income can give you peace of mind that you can still pay for the things you need, in the event that you're off work through illness or injury.

What's the difference between Critical Illness Cover and Illness and Injury Insurance?

Critical Illness Cover pays out a lump sum on a valid claim if you’re diagnosed with or undergo a medical procedure for a specified critical illness set out in your Policy Booklet. You can use your lump sum as you wish, to pay for bills or medical expenses, but once you have received your lump sum, you will no longer be entitled to a further pay out, and your policy will end.

With Illness and injury insurance, the monthly benefit could be used to help pay for regular bills and living expenses for any illness or injury that prevents you from working.

Key considerations of illness and injury insurance

The key consideration when taking out an illness and injury insurance policy is the financial protection you could receive in the event of a valid claim.

One of the advantages of this type of policy is that it pays out monthly, so you don’t need to worry about a regular income to cover monthly bills.

Considerations of illness and injury insurance protection:

  • Protects your salary when you cannot work through illness or injury
  • Pays out monthly, which can be used to help budget and pay regular bills
  • Offers financial stability for you and your family
  • Gives financial peace of mind when suffering from an illness or injury
  • The benefit is not paid for the first four weeks that you are off work and is then paid monthly in arrears
  • There is a maximum of 12 monthly pay-outs per valid claim
  • Cover ends when you are 60

Is illness and injury cover just for the self-employed?

As a self-employed person, having some form of insurance to protect you could be invaluable. If you work for yourself, you’re not entitled to some benefits that come with being full-time employed, including paid sick leave and/or SSP.

Therefore, taking out an illness and injury insurance policy can cover you if you can’t work due to illness or injury. Taking out an insurance policy isn’t just for the self-employed though, this type of cover can be invaluable for full-time employees too, if:

  • Your employer doesn’t offer contractual sick pay, or the benefit is less than you need
  • You want a safety net to protect your family finances
  • You need added peace of mind if you are unwell or suffer an accident or injury

Illness and Injury Insurance is not a savings or investment product and has no cash value unless a valid claim is made. The policy does not include unemployment cover and will not pay out if you become unemployed.

Get the right Illness and Injury Insurance for you

Ultimately, the best Illness and Injury Insurance to get is a policy that matches yours and your loved one's needs, providing the right amount of cover and financial support to give you peace of mind in the event you can’t work due to illness, injury or an accident.

Our partners Nationwide Building Society and property technology platform Goodlord offers simple online application journeys and cover from as little as £6 per month, depending on your circumstances, for Illness and Injury Insurance.