Sick Pay Insurance: Income Protection Cover for Employees

Sick Pay Insurance
Image Source: InsuranceClinicBelfast

Every year, over 1 million people in the UK are unable to work due to serious illness or injury. And for those who are self-employed, there is no insurance option for company sick pay. Sick pay insurance or income protection provides you with the possibility of a regular monthly income if you’re unable to work due to an injury or illness.

While company sick pay is only available to employees, sick pay insurance is available to both employees and employers. It exists to provide a monthly income until you’re well enough to return to work. 

As you engage in the piece, you’ll learn more about sick pay insurance for self-employed people and employees. Again, you’d learn about the various sick pay insurance providers in the UK from various customer reviews. This would help you decide which one best meets your needs.

Sick Pay Insurance

Could you pay your mortgage, fund your monthly expenditures, or sustain your family if you didn’t have a job? For the majority of people, the response is ‘no’ – or ‘not for long,’. This is why they opt for sick pay insurance for added assurance.

Sick pay insurance is a sort of insurance that protects employees if they are unable to work due to a medical condition. If you have bills to pay, you can have peace of mind knowing that even if you’re unable to work, you will be able to get by without your salary.

Furthermore, if you’re unable to work for a long period due to a mental or physical illness, sick pay insurance for employees will ensure that you have enough money coming in each month to cover your bills until you’re able to return to work.

This type of sick pay insurance covers any illness confirmed by a medical professional. Perhaps you’re out riding with friends and have an accident, or you’re under a lot of stress. Life is unpredictable, and income protection is only a safety net in case things go wrong.

It’s deception to believe that we’ll always be strong and healthy. But, like many types of health insurance, most individuals don’t realise how crucial income protection is until they are unable to work. To avoid this, sick pay insurance is one method of putting a plan in place — so you never find yourself in financial difficulty as a result of your health.

Benefits of Sick Pay Insurance for Employees

In addition to all that has been said, this service gives practical, confidential information and helps with a wide range of lifestyle difficulties. For example, stress, relationships, family life, job, and money. The sooner an illness or injury is diagnosed and treated, the sooner it is possible to return to work.

Self Employed Sick Pay Insurance

As it is with the employees, sick pay insurance cover the employers too. When you work for yourself, you get the sweet advantage of being your own boss. However, you forego typical employee benefits like company sick pay.

Getting sick pay insurance as a self-employed person helps create a financial safety net in case of illness or injury. Furthermore, when deciding whether sick pay insurance is good for employers, there are a few questions you should ask yourself:

Will you be able to financially support yourself and your loved ones if you become sick or wounded and are unable to work? Is there anything else that could help you get by if you lose your income, such as savings?

Consider your monthly payments, such as mortgage or rent, utilities, food, and other necessities. Aside from family, you may need to think about how to keep your business running.

In case of illness or accident, self-employed sick pay insurance pays a monthly fixed amount. Depending on your insurance, you’ll get benefits until you’re ready to return to work, the policy term expires, or you retire.

When you first buy the insurance, you usually get to determine how much money you’ll get if you need to make a claim, how long your policy will continue, and how long the delayed period will be. However, depending on the precise income protection policy you choose, there may be some limitations or restrictions.

How Much Sick Pay Insurance Does a Self-Employed Need?

Absences due to illness can pose issues in any firm. Costs can be unpredictable, making financing difficult and leaving some organisations struggling to absorb the costs. As an employer, you may not earn the same constant amount each month as you would with a fixed salary.

So, while determining how much income protection you require, evaluate how much money you spend each month. Make a list of the important expenses that would continue if you were unable to work, for example, your mortgage or rent, energy bills, food, and childcare.

Remember that sick pay insurance doesn’t cover all of your lost earnings or all of your monthly outgoings, only a portion of them.

Benefits of Sick Pay Insurance for Employers

For employers, the sick pay insurance helps you in terms of:

  • Controlling costs with a monthly premium that is lower than what you could pay out for sick leave absence.
  • Early detection and intervention, as well as access to professional resources, can help reduce the duration of illness and its related expenses.
  • Discover the primary causes of employee absenteeism, which will assist in identifying issues and patterns and enabling proactive responses.

Difference Between Sick Pay Insurance and Sick Pay

Earlier on I mentioned company sick pay as one of the benefits a self-employed don’t get to enjoy as employees do. You’re probably wondering now what the difference between sick pay insurance and sick pay is. In a bid to enlighten you, here is what differentiate company sick pay insurance and sick pay insurance.

The first point is that employees get a certain amount as a benefit if he or she is sick and unable to work. If you have a steady job, it’s likely that you’ll receive some sick pay from your workplace. This could be either employer sick pay (“contractual” or “occupational” sick pay) or statutory sick pay, or both.

Sick pay from employers normally indicates that you’ll get your regular earnings while you’re out for a certain number of weeks, followed by a reduced payment for the same number of weeks. If you’re still unable to work after your employer’s sick pay has run out. Or, perhaps you work for a company that does not offer sick pay, you will be eligible for statutory sick pay of £95.85 per week for a maximum of 28 weeks.

On the other hand, sick pay insurance is something you purchase rather than something supplied by your company. This insurance intends to cover you after your sick pay runs out – or, if you’re self-employed, to cover you if you don’t have any sick pay at all. If you have income protection, you can set your waiting period so that it begins after your sick pay finishes. This gives you peace of mind that you’ll still have money flowing in even if you’re unable to work.

Who Needs Sick Pay Insurance 

Simply put, everyone who would be financially impacted by a loss of income due to illness or injury should consider income protection. This includes the following:

  • Couples: Income protection is a strategy to secure your shared finances if you have financial commitments such as a mortgage or monthly rent with a partner. We don’t need to warn you that raising a child can be costly. If your family would struggle to make ends meet without your income, income protection might provide you with peace of mind.
  • Single parents: If you’re raising a family on your own, your income may be critical to the health and well-being of your child or children. Income protection ensures that your family will not face financial hardship if you’re unable to work due to illness or injury.
  • Self-employed: If you’re self-employed, you will not receive sick pay from your company, making you more vulnerable if you’re unable to work. In the absence of this, income protection will provide you with a safety net, allowing you to rest and heal without worrying about your finances.

Sick Pay Insurance UK

Considering the number of income protection insurers in the UK, finding the best sick pay insurance to meet your needs can be difficult at times, but it doesn’t have to be. Consider the following insurance policies and evaluate which one best suits your needs

#1. Aviva

Aviva is one of the best sick pay insurance in the UK that provides flexible coverage options. These options involve the ability to select your monthly benefit, deferred period, and policy length.

It provides:

  • Rehabilitation assistance to assist you in returning to work.
  • Fixed monthly premiums that remain constant throughout the term of your policy.
  • When you return to work after an illness or injury, you will receive a one-month back-to-work benefit.
  • A monthly sum of £500 – £1,500, depending on availability.
  • Aviva currently has a rating of 4.7 out of 5 stars on the customer review site Trustpilot, with an overall rating of “Excellent.” However, this applies to all of Aviva’s insurance cover options, not just sick pay insurance.

#2. AIG Home

Next on the sick pay insurance providers in the UK is AIG Home. They are popular for providing income protection, which they consider to be “the most appropriate form of support for sensitive scenarios.” This is why they can help with trauma, death, and terminal illness. They also have a plethora of features such as:

  • Up to £100 per night for hospital stays of up to 90 days.
  • Assistance with rehabilitation.
  • A deferred period of four, eight, thirteen, twenty-six, or fifty-two weeks.
  • You can take out a policy between the ages of 5 and 53, or until you reach the age of 70, and you can receive monthly sums ranging from £500 to £1,500.

AIG is rated 3.1 out of 5 stars on the review website Trustpilot, with an overall rating of “Average.” Notwithstanding, this applies to all of AIG’s products and is not limited to its income protection insurance (correct as of January 2022).

Legal & General is the third UK sick pay insurance provider for employers and employees. They provide a wide range of benefits through standard policies such as:

  • Payouts are tax-free after a deferred waiting period of 4, 8, 13, 26, or 52 weeks. You choose the length of the wait.
  • Coverage that lasts until your chosen retirement age, but you can cancel at any time without penalty.
  • You’ll continue to receive your monthly benefit of up to £1,500 until you return to work or your policy expires.
  • On their sick pay insurance policy, Legal & General also provides up to £150 per night for hospital stays, rehabilitation assistance, and return to work benefits.

Legal & General has a rating of 3.2 stars on Trustpilot. It has an overall rating of “Average” based on over 11,200 reviews. Also, this is for all of their insurance policies combined.

#4. Royal London

Royal London’s income protection insurance provides assistance when you need it the most. It includes up to £150 per night in hospital expenses, as well as back-to-work benefits and fracture coverage as standard.

Also, Royal London pays up to 65 % of your pre-tax earnings to £15,000, plus up to 55 % of the rest. Unfortunately, this insurance provider has a rating of 1.8 stars out of 5 on Trustpilot. This applies to all of Royal London’s insurance products (true as of January 2022)

#5. The British Friendly Society

The British Friendly Society offers a variety of income protection-style products that can provide short-term cover for self-employed, casual, or part-time workers, as well as coverage for a child’s education and coverage during sickness and injury.

Its more basic sick-pay insurance plan, Protect, is available to employees or employers aged 18 to 64. It can pay up to 70% of your annual taxable income if a doctor determines you’re unable to perform the essential functions of your job. 

A weekly benefit is paid into your bank account to help replace lost wages due to illness or injury.

The British Friendly Society has a Trustpilot rating of 3.9 stars out of 5 with an overall rating of “Great” 

#6. Wesleyan

According to UK Wesleyan, its sick pay insurance intends to “keep the money coming in when you’re off work due to illness.” Its strategy also includes:

  • Access to free healthcare and support services to help you get back to work as soon as possible.
  • Doctors and dentists will benefit from tailored, increased coverage.
  • A monthly sum of up to £4,000 is available.
  • When your sick pay ends, you will receive monthly benefits, ensuring that your income is always protected.
  • Your policy can be extended until your 70th birthday.

Based on over 700 reviews, Wesleyan received a rating of 4.8 stars on the review website Trustpilot. This is for all of Wesleyan’s insurance options, and it has an overall rating of “Excellent”

#7. Vitality

Income Protection Cover, Income Protection Cover Plus, Short Term Income Protection Cover, and Public Sector Employee Benefits. These are just a few of the sick pay insurance cover levels available from Vitality. Since each level of coverage is unique, it’s critical that you select the best one for you.

You can get the following benefits with Vitality’s standard income protection policy:

  • Monthly coverage of up to £1,500
  • Rehabilitation assistance if you require it in order to return to work
  • If you’re hospitalised, you may be charged up to £100 per night.
  • Assisted car service
  • Education assistance is available if you require training courses to help you reskill.
  • If you become disabled, your benefits will be increased by 10%.

To apply, you must be between the ages of 18 and 60. Vitality has a Trustpilot rating of 4.2 out of 5 for all of its insurance products. It has an overall rating of “Great” based on over 24,100 reviews


Getting sick pay insurance protection doesn’t imply that you’re wishing sickness upon yourself. Like I said,  in life, we never know what’s around the corner. Moreover, it’s deception to believe that we’ll always be strong and healthy. 

This insurance is not for you if you are confident that you will not lose your job. If, however, your income is threatened, you should contact one of the insurance companies listed above.

FAQ’s On Sick Pay Insurance

Employers have the right to refuse to pay sick leave.

Your employer may opt to make an exception and give you sick pay even if you do not meet the company’s eligibility requirements. Furthermore, some sick pay plans state that payments are at the discretion of the employer. This means that your employer has the right to deny payment if they believe your absence is unwarranted

Can I make any claims while on sick leave?

If your income is reduced while you are unable to work due to illness, you may be eligible for benefits. You should first determine whether you are eligible for Universal Credit. If you require long-term assistance with daily duties or transportation, you may be eligible for benefits such as Personal Independence Payment (PIP).

What am I able to claim if I am not working?

When you are unemployed or working for less than 16 hours per week and seeking work, you may be eligible for New-Style Jobseeker’s Allowance (JSA) You can apply for both JSA and Universal Credit at the same time, however, your Universal Credit will be lowered by the amount of JSA you get.

What am I able to claim if I am not working?

If you are unemployed or working for less than 16 hours per week and seeking a job, you may be eligible for New-Style Jobseeker’s Allowance (JSA)…. You can apply for both JSA and Universal Credit at the same time, however, your Universal Credit will be lowered by the amount of JSA you get.

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If you are unemployed or working for less than 16 hours per week and seeking a job, you may be eligible for New-Style Jobseeker's Allowance (JSA)…. You can apply for both JSA and Universal Credit at the same time, however, your Universal Credit will be lowered by the amount of JSA you get.

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