A new product launched by britishinsurance.com addresses one of the main weaknesses of income protection insurance, which pays out a regular income if you are unable to work as a result of long-term illness or injury. Most income protection policyholders do not receive any benefit payments for the first 3 or 6 months of a claim due to an initial deferred period. sickpayplus.co.uk can plug this gap by enabling anyone off sick for 30 days to receive immediate monthly benefits backdated to day one.
For 3 months, the product costs only £1.35 a month per £100 of monthly benefit
For 6 months it costs only £2.10 a month per £100.
Cover can be taken out over a 9 or 12-month period. This gives an alternative to those who are unable to obtain income protection without significant premium loadings or exclusions. sickpayplus.co.uk, unlike income protection, does not penalise policyholders on the grounds of occupation, gender, age or smoking habits.
Simon Burgess, managing director of British Insurance who own sickpayplus.co.uk, says, "The product has introduced a whole new dimension to protection planning and is so affordable that I expect most income protection policyholders to give it serious consideration. The product should also prove popular with those who fail to qualify for standard income protection terms, because having cover for only 9 or 12 months is likely to be preferable than not being able to afford any at all. It can at least provide people with a valuable breathing space in which to reappraise their circumstances and plan their finances going forward.”
Income Protection insurance : News update: December 2006