Are you wasting money on Income Protection?

Don't be confused, Income Protection is definitely NOT a waste of money and extremely crucial for most people.

However, for most policies (called indemnity policies) you can only claim up to a certain percentage of your yearly salary (usually 75% or 70%).

So therefore, if your current sum insured is more than the maximum amount, you are essentially paying extra premiums for no value and are wasting good money.

This can often happen if you haven't reviewed your sum insured amount for a while and your income levels have reduced. For instance, you may now be working part time or simply earning less.

It is easy to adjust your sum insured in line with your salary with you current insurer and it typically doesn't require new medical questions if you are reducing the cover down.

However, it is best to reach out to a Financial Adviser first to determine:

• What type of income protection policy you have (if you have an older style agreed value policy, you most likely don't need to reduce it down as your income was assessed at the time of application)
  

• Whether there are any new better providers for your new situation