Income Protection and Critical Illness | Harper Health & Financial Solutions

Income Protection

What it does – This type of policy pays a monthly income tax free if you are unable to work due to an illness or injury.

What you need to know – State benefits aren’t generous and few employers will continue to support their staff through a long illness, so income protection policies can help families through difficult financial times. You can choose the date at which the policy would pay-out in the event of a claim. This can range from a month to up to a year. Policies that pay-out sooner will have higher premiums.

Critical Illness

What it does – Critical illness cover pays out a tax-free lump sum if you are diagnosed with a major illness, including cancer and heart disease. Actual illnesses covered in a policy may vary between providers.

 What you need to know – Many people buy a combined life and critical illness policy, and it makes sense to do so. In this case, a payment would be made on either diagnosis of a critical illness as defined in the policy, or death, whichever is the sooner. If the cover is combined in this way, the policy premium is usually cheaper than it would be for separate policies, as there is only ever one lump sum paid out by the insurance company.