What is sick pay insurance?

If you couldn’t work for a couple of months or even for a few years, would you be able to get by on £99.35 a week? The rate of Statutory Sick Pay (SSP) in the UK is astronomically low but if your employer does not provide you with sick pay, you may be left with no choice but to resort to SSP.*

With income protection, having to take time off work due to illness or injury doesn’t have to be a worry anymore. But how does income protection work and how can this policy actually help?

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What would you do?

If you were unable to work due to illness or injury, what would you do? No one knows what’s around the corner and it’s easy to assume “everything will be alright”. But if you weren’t able to work as normal for a few months and you don't have much in savings, there are only a few options you may have;

  • Asking loved ones for help
  • Taking out a loan
  • Asking your workplace for help


Sadly, none of the above options are realistic for most which is the reason why life insurance policies like income protection exist. With an income protection policy in place, you’ll have peace of mind that if you weren’t able to work for a while, you could still afford to get by.

What’s the difference between sick pay and sick pay insurance?

If you’re lucky enough to have sick pay provided by your employer, it may only last for a few weeks. After these weeks are over, if you’re still unable to work, you’ll move to SSP.

Income protection, sometimes known as sick pay insurance, offers so much more than employee sick pay could. The regular pay-outs from income protection are typically aligned with the amount of money you get paid or you can choose to cover your outgoings. Your cover will always be tailored specifically to your current job role, so no policy is ever one size fits all.

If you do have sick pay provided by your workplace, you can time your income protection policy to kick in as your sick pay comes to an end. This way, you’d be protected the whole time that you’re ill and wouldn’t have to worry about struggling with money.

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All the ways it can make life easier

The money you receive from your income protection policy can be used for whatever you want but most people choose to use the regular pay-outs to help pay for the essentials. Here are just a few examples of the things you could pay for with your cover:

  • Food shopping
  • Monthly bills
  • Childcare costs
  • Mortgage or rent payments
  • Cleaning products
  • Vets bills
  • Petrol money
  • Cash for public transport
  • Toiletries

What if you’re self-employed?

If you work for yourself, income protection is arguably one of the best forms of financial protection you can have. Being self-employed can often mean your income is unpredictable at the best of times. Without an income protection policy in place, you and your loved ones could be at risk of struggling financially, if you became ill or injured and couldn’t work as usual.

income protection policy will cover up to 50-70% of your wage. This money would enable you to focus all your energy on your recovery and wouldn’t have to worry about how you and your loved ones would afford the basics in life.

With all the perks that come with being your own boss, having no sick pay is one of the few disadvantages of being self-employed. But with an income protection policy in place, you can continue building your empire without the added worry of what you would do if you became ill.

Need help?

At Caspian, we help make life insurance simple. We get to know you and look at your circumstances, health, lifestyle and loads of other different factors to be able to make the best life insurance recommendations for you.

We search through the UK’s leading providers, taking your affordability and needs into account, to find the cover that’s right for you. At Caspian, we save you time and money (we do the hard work for you and our service is 100% free), find out what we’re all about and start your free quote below.


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*SSP accurate as of January 2023