Standard Income Protection Rarely Covers for Contractors!

Contractor Income Protection pays you a monthly benefit if you are ill, become injured or disabled. Its policies offer peace of mind and protect you and your family from the financial impact of being unable to work as a consequence.

On the face of it, contractor cover sounds like standard par for the course protection. But there’s an acute difference: standard insurance protects ‘salary’.

As most limited company owners are aware, their salary rarely reflects what they earn. So, how do you go about protecting your income, rather than your take home pay? That’s what we’re about to find out, here.

Contractors need to make an informed decision

As we allude, traditional income protection policies may not protect you as well as you think. For example, a lot of policies will stop paying you an income, or the benefits, as soon as you’re ready to do any sort of work. That’s a crucial difference.

That means you could end up facing a dire choice: undertake a job you don’t want to do or lose the income benefit.

I don’t know about you, but as a specialist, it would be hard to replace your current income working in a menial or unknown industry. You’ve not bought a dog to bark yourself, have you?

Neither do the majority of insurers verify your income when you take out their cover. As such, if you take a drop in salary, the income they’ll pay you may drop too.

Apart from the obvious disadvantages, you might not get the cover you thought your premiums were buying.

Income Protection Cover for Contractors

There is an alternative. PruProtect offers tailored cover that provides Income Protection for contractors all over the UK.
Here are just some of the reasons independent professionals choose their cover:

Prices for men will rise in December 2012

New EU legislation comes into effect on 21st December. What it means is that insurance companies can no longer charge a different premium based on gender.

This will impact the price men can expect to pay for Income Protection Cover in the future. In real terms, their premiums may increase by as much as 20%.

You have a (genuine) once-in-a-lifetime opportunity to avoid this price increase. Take out your cover before 21st December when the new rules come into effect and pay only the pre-increase rate.

Protect yourself and your family

As a contractor, you have zero protection in the event of your death or a critical illness without cover. As a company, we specialise in providing income protection to contractors, such as yourself.

As all the services we provide cater for the self-employed in one way or another, we:

You don’t have to do the research yourself in trying to find insurers who will meet your specific requirements. We have done the leg work for you already.

Whether you already have minimal income protection cover in place or nothing at all, we can help you get the relevant cover you need.

And that’s what it’s about – relevance. Don’t let your contractor business go to the dogs because your income protection is barking up the wrong tree.


Author: John Yerou

John Yerou is a pioneer of contractor mortgages and owner and founder of Freelancer Financials, Contractor Mortgages®, C&F Mortgages and Self Employed Mortgages, trading styles and brands of the award-winning Mortgage Quest Ltd.