Income protection should cover pension contributions, adviser says

Often covers just monthly outgoings

clock • 3 min read

Providers of income protection should allow additional cover for pension contributions, similar to the group income protection and executive income protection, adviser firm Drewberry has said.

The majority of mainstream income protection insurers only cover 50% to 60% of gross annual income, the adviser firm highlighted.  Drewberry warned this amount is often just enough to cover a client's essential monthly outgoings but generally does not leave enough room to cover the pension contributions a client would need to make during incapacity to survive financially during retirement. Drewberry suggests that insurers provide an option to cover a specified pension contribution when setting up new income protection plans, in addition to the usual 50% to 60% for lifestyle protection...

To continue reading this article...

Join Professional Adviser for free

  • Unlimited access to real-time news, industry insights and market intelligence
  • Stay ahead of the curve with spotlights on emerging trends and technologies
  • Receive breaking news stories straight to your inbox in the daily newsletters
  • Make smart business decisions with the latest developments in regulation, investing retirement and protection
  • Members-only access to the editor’s weekly Friday commentary
  • Be the first to hear about our events and awards programmes



Already a Professional Adviser member?


More on Income Protection

Tom Baigrie: 'Insurers and distributors are failing to market IP'

'We need to pick up the pace'

Tom Baigrie
clock 16 November 2020 • 3 min read

L&G paid out almost £300m for group protection in 2018

Rehabilitation services

Adam Saville
clock 09 May 2019 • 1 min read

'One in five' UK businesses lack expertise to manage absence

Zurich research

Adam Saville
clock 04 February 2019 • 1 min read