No sick pay behind you
Employed households usually have some employer support, however limited. Directors and the self-employed generally have none, and the business often depends on their presence for its revenue.
That combination is exactly what income protection is designed for.
The definition that matters
For a director drawing a small salary with dividends, a policy based on salary alone may pay far less than expected. Insurers differ in whether they include dividends, retained profit or share of net profit.
This single detail is worth more scrutiny than the headline premium.
- Check exactly how insurable earnings are defined
- Consider whether an executive plan funded by the company is appropriate
- Match the deferred period to how long savings would realistically last
Preparing the enquiry
Recent accounts and tax calculations make the process much smoother, and let a specialist give a realistic view early rather than after several weeks of underwriting.
Sources and further reading
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