Being unwell is challenging at the best of times – but it can be even more challenging if it leaves you unable to work. Without financial protection, the potential loss of earnings could have significant financial consequences on any household, especially as most of us base our regular outgoings on our regular income.

This is where income protection comes in. It can compensate for loss of income by providing monthly payments, usually up to 50-60% of your pre-tax earnings, if you’re unable to work for physical or mental health problems. This money can provide a lifeline at a difficult time – and while there are no rules on how you should spend the cash, most people use it to make sure essential living costs like the rent or mortgage, bills, food, and transport are paid for.


What does an income protection policy cover me for?

If you’re covered by an income protection policy, you can make a claim if you experience any health problem that impacts your ability to work and earn money. The most common reasons for claiming are:

  • Musculoskeletal problems – like broken bones or back pain
  • Mental health conditions – like depression, stress or anxiety
  • Serious illnesses – like cancer, heart disease or strokes

But remember: these are just examples. With income protection, you're covered for any medical reason, so long as you've been signed off work by a medical professional. The only exception to this is if there's an exclusion on your policy, which we'll explain more about below.


If you’re covered by an income protection policy, you can make a claim if you experience any health problem that impacts your ability to work and earn money.

What doesn't an income protection policy cover me for?

An income protection claim can only be made if you’re unable to work for a medical reason. That means if you lose your income for any other reason – such as redundancy or resignation – you won’t be able to make a claim on your policy.

Your income protection policy may also include certain exclusions. Many insurers exclude loss of income because of an injury caused by self-harm, for example. And if you disclose an existing health condition when you apply, your insurer may apply an additional exclusion around that, depending what it is. It's extremely important to be honest about your health and lifestyle when you apply for a health-related insurance product like income protection – otherwise you risk invalidating your policy and it not paying out when you really need it to.


An income protection claim can only be made if you’re unable to work for a medical reason – so if you lose your income for any other reason, like redundancy or resignation, you won’t be able to claim.

Anorak tip: Talking to one of our advisers is best if you want to apply for income protection but you have an existing health condition. They'll be able to help you find the insurer who offers the best terms for you and your situation. Call 020 3514 6702 (Mon-Fri – 9.30am-6pm).

When does income protection pay out?

You can make a claim on your income protection policy if you're signed off work by a medical professional. Your claim will be successful if you meet your insurer's definition of incapacity. And you'll start receiving payments after your waiting period.

Insurer's definition of incapacity

Your insurer's definition of incapacity is their definition of you being unfit to work. Different policies come with different definitions, but common ones include: own occupation definition, suited occupation definition, any occupation definition, and activities of daily living definition.

Anorak tip: Buying a policy with 'own occupation' definition is generally best. It's less strict than the others – as it pays out based on you being unable to do your own job role (not any job, for example). Read more about the other definitions in our income protection glossary.

Waiting period

An income protection 'waiting period' is how long you wait between becoming too ill to work and starting to receive your monthly insurance payments. Typical waiting periods are: 1, 4, 8, 12, 26 or 52 weeks. You choose this when you take out a policy, based on how quickly you'd need to start receiving payments if you lost your income.


What's the difference between income protection and critical illness cover?

Income protection and critical illness cover are both types of insurance that protect you in case of ill health – but what they cover you for and the way they pay out is different.

  • Income protection covers you for any medical reason, so long as you're signed off by a medical professional, and pays out a monthly amount if you need to claim
  • Critical illness cover covers you for any of the specific illnesses or conditions listed in the policy you buy and pays out a lump sum if you need to claim

Both offer valuable protection in case of illness or injury, and there’s nothing to stop you taking out both policies – but one of the benefits of income protection is that it covers any medical problem (including the kinds of critical illnesses and conditions covered by a critical illness policy, so long as it stops you from working). If you've been signed off by a medical professional, you can claim on an income protection policy – whatever the cause.

Anorak tip: To decide whether or not you need income protection, think about what type of financial protection you’d need in reality. Would you and your family be able to manage without your income if you were too unwell to work? How long could you get by for? Do you have any other backup plan in place? Income protection could be that plan – enabling you to cover the essentials without using up savings or borrowing money from elsewhere.
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  • Income protection covers loss of income caused by any medical reasons
  • You can claim on your income protection policy if you've been signed off work by a medical professional, whatever the cause
  • Income protection doesn't cover any other kind of income loss, like redundancy
  • Income protection will pay out after your waiting period, so long as you meet your insurer's definition of incapacity
What is income protection?
An insurance policy that pays a monthly amount if you can't work for any medical reason. It's designed to replace part of your missing income, so you'll always be able to cover the essentials, even if lose your income because of an illness or injury.
What does income protection cover?
Income protection covers you if you're unable to work for medical reasons. This includes any illness or injury, physical or mental, that leads to you being signed off work by a medical professional.
What doesn't income protection cover?
Income protection won't cover you if you're not working for anything other than a medical reason – like redundancy. You won't be able to claim on your income protection unless you're signed off work by a medical professional.
How much does income protection cost?
The cost of cover is different per person because it depends on how much cover you buy, how quickly you'd need the policy to start paying out, and how much of a risk you are to insure (based on your age, health and lifestyle).
Will my income protection pay out?
Yes, if you meet what's known as your insurer's 'definition of incapacity' – in other words, you meet their criteria for being unable to work. This definition is based, among other things, on the job you do, and you can read it before buying the policy.