Taking out Income protection cover provides a plan holder with a regular income which is paid in the event that they cannot work due to long-term illness or injury.
Income protection plans usually have a deferred period, this is typically 13, 26 or 52 weeks to be chosen by the plan holder, Once this period has elapsed the plan holder receives the income protection benefit is paid to replace up to 75% of the income lost less any social welfare benefit entitlement while off work.
The cover and potential benefit payment expires at 55, 60 or 65 depending on occupation and customer choice.
This plan can be particularly attractive to the self employed as premiums associated with cover are fully tax deductible, once certain conditions are met.