Income Protection Insurance
This type of policy is designed to provide an income in the event that the insured individual becomes unable to work due to ill health. The level of premium will depend upon the amount of benefit and term selected and most policies cease to pay the benefit once the insured is able to return to work. Income Protection policies are usually written to retirement age.
Accident, Sickness & Unemployment (ASU)
ASU policies were traditionally sold to accompany mortgages, allowing for a regular income to be paid to the insured should they be unable to work due to ill health, an accident or loss of their job. The product can be split down, and unemployment cover is usually the optional extra available for an additional premium. Benefits are only usually paid for a specified time, for example 12 months. It is important to compare ASU and Income Protection closely as one may be more suitable than another. It may also be possible to use the two products to work in tandem with each other.