If your income stopped tomorrow because of illness or injury, how long could you cover your mortgage? For most UK workers, the honest answer isn’t reassuring — and it’s why income protection has quietly become one of the most talked-about products in UK personal finance this year.
The protection gap is still huge
Most UK workers currently have no income protection in place at all. Yet research shows a large majority expect to face financial hardship within six months of being unable to work due to illness, and a meaningful share have no idea how long their savings would actually last them. That gap between exposure and cover is exactly what income protection is designed to close.
The regulator has taken notice too — the FCA has made narrowing the protection gap a specific focus of its ongoing market study, looking at how digital tools and better guidance could help convert the substantial proportion of uninsured workers who say they’re interested in cover but haven’t taken the step yet.
What income protection actually covers
Income protection replaces a portion of your income — typically 50% to 70% of gross earnings — if you’re unable to work due to illness or injury. Unlike critical illness cover, which pays a single lump sum for a defined list of serious conditions, income protection pays a regular monthly income for as long as you’re unable to work, up to the end of your chosen term.
Two features matter more than most people realise when comparing policies:
- “Own occupation” vs “any occupation” definitions. An own-occupation policy pays out if you can’t do your specific job. An any-occupation policy only pays if you can’t do any job at all — a much higher bar to meet. Own-occupation cover is generally worth the extra cost.
- Deferred period. This is how long you wait after becoming unable to work before payments begin, often between 4 and 26 weeks. A longer deferred period lowers your premium but means a longer gap to bridge from savings or sick pay first.
What it costs in 2026
Premiums vary widely based on age, occupation, health and cover level, but for a healthy applicant in an office-based role, short-term policies can start from around £5–6 a month, rising to roughly £13–22 a month for comprehensive full-term cover running to retirement age. Self-employed clients — who have no employer sick pay to fall back on — are often the ones who benefit most, since Statutory Sick Pay alone rarely covers meaningful outgoings.
Do claims actually get paid?
This is one of the most common objections I hear, and the data doesn’t support it. Across the industry, more than four in five income protection claims were paid in the most recent full year of data, with hundreds of millions of pounds paid out in total. Individual insurers report payout rates in the high 80s to mid-90s percent range. The gap between insurers usually comes down to policy wording and underwriting quality at outset — which is exactly where good advice at application stage makes the difference, since accurate medical disclosure protects your claim later.
A shifting claims picture
One trend worth knowing about: mental health related claims now make up a significant and growing share of income protection claims industry-wide, a marked rise from pre-2020 levels. This reflects both greater awareness and genuine increases in work-related stress and burnout — and it’s a good reason to check that any policy you’re considering doesn’t unduly restrict cover for mental health conditions.
Why this matters if you have a mortgage
Mortgage payments don’t pause because you’re unwell. For homeowners — particularly those who are self-employed, contracting, or the sole earner in a household — income protection is often the single most important piece of financial planning that gets skipped in favour of life insurance alone. Life cover protects your family if you die; income protection protects your household if you simply can’t work for an extended period, which statistically is a far more common event.
Getting the right policy
There’s no single “best” insurer for every buyer — the right fit depends on your age, occupation, medical history and budget, and quotes can vary considerably between providers for the same applicant. This is where working with a broker who can compare across the market, rather than approaching a single insurer, tends to produce a meaningfully better outcome.
Speak to a north Norfolk protection adviser
At Emily’s Mortgage Services, protection advice sits alongside every mortgage conversation I have — because a great mortgage rate means little if an illness or injury could put your home at risk. I compare income protection, critical illness and life cover across the market to find the right fit for your circumstances and budget.
This article is for general information and does not constitute financial advice.
FAQs
Is income protection worth it if I have savings? Savings can bridge a short gap, but most households can’t sustain their outgoings for more than a few months without income. Income protection is designed for exactly the scenario where savings run out.
Does income protection cover redundancy? No. Standard income protection covers illness and injury only. Unemployment cover is a separate, usually short-term product often called Accident, Sickness and Unemployment (ASU) cover.
How much of my income can I insure? Most insurers allow you to cover between 50% and 70% of gross earnings.
Is income protection regulated? Yes — all UK income protection providers are regulated by the Financial Conduct Authority
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