The far-reaching importance of income protection insurance should never be underplayed (and most certainly acted upon by those in a position to do so here and now) according to one leading charity-backed initiative which serves to help (and continue to raise public concern about) the plight of individuals whose means of employment has been severely compromised as a direct result of a long-term illness of disability.
We’re referring to the sterling work carried out by www.7families.co.uk, which is a charity-led campaign whose aim is to provide a tax-free income for 7 people (and subsequently their immediate family and dependents who rely on them) who have seen their means of income lost (due to illness or disability) for the course of 12 months.
7 Families has released its own timely report which flags up some startling figures about the subject of those unfortunate people who suddenly find themselves no longer able to work because of unforeseen illness and disability prognosis’, yet without any means of financial support (and in this instance, intervention from the 7 Families scheme) would be struggling to make ends meet.
7 Families has identified through its research that potentially millions of people here in the UK would grapple, largely unsuccessfully, to manage financially what monetary resources they did have at their imminent disposal in the unexpected event of losing their job.
The study undertaken by 7 Families, to try and determine the extent of the often under-documented problem of families suddenly finding themselves pitched into an almost impossible situation due to scenarios beyond their control, highlighted the underlying fact that some 2 million people are currently not seeking employment for the inescapable reason that a long-term illness has rendered it unrealistically achievable.
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Going on to reveal the scale of the problem and the 7 Families report suggests that the number of people out of work on the grounds of poor health has increased by 62,000 in the past year alone; which leads to the aforementioned 2 million presently in this predicament per se
With this very much in mind 7 Families has reiterated just how vital it is that those currently enjoying sustained periods of employment (with a potentially secure and on-going future in their particular profession as it stands) should look to arrange a comprehensive income protection insurance policy now, so as to guard against events which could lie around the corner.
Ignorance is as always bliss, and not only is awareness of these type of plans not as commonplace as it should be there’s the added issue that (mistakenly) a massively ill-advised fifth of workers in this country believe that the state would jump in and cover their backs, financially-speaking, if they were forced to give up their occupation due to serious health diagnosis and medical ramifications.
Unfortunately the financial support infrastructure the Government has in place for people to call upon at times like this isn’t anywhere near substantial enough to compensate for the often draconian shortfall in income streams for most households.
Essentially it’s wrong to think that the state would be in a position to step into the fray and help people maintain the lifestyles to which they’re accustomed, pre-illness lay off, not least because the existing benefits system itself is experiencing major cutbacks in a concerted bid to balance the recovering economy.
However despite this many of the working population have this sense of belief that the state will ‘look after them’ (and financially support them) in their darkest hours. Sadly this isn’t the case and this false hope should never be relied upon if and when worst case scenarios begin to pan out. 7 Families’ Peter Le Beau (when speaking with the www.independent.co.uk recently) said; “The reality is often that people would struggle to pay their mortgage, rent or the day-to-day bills if they suddenly had to rely solely on benefits.”
Which to recap is all the more reason why people should grasp the income protection insurance nettle, which to the uninitiated pays benefits to policyholders who are incapacitated (and hence unable to work) due to illness or accident; by way of a monthly income which covers a significant percentage of your last salary (typically between 50 – 70% and received tax-free) to not only financially offset the burden of mortgage payments and outstanding loan agreement, but also to distribute as the insured party sees fit toward ongoing utility bills, grocery shopping and the costs associated with kid’s schooling for example.
Traditionally paying out until the policyholder is medically deemed able to return to work, retirement age is reached (or if a short-term plan, such a date juncture as pre-determined by both parties) or (in more tragic circumstances, death occurs), income protection insurance also proffers access to counselling and ‘back to work’ services for those aiming to get back on their feet in the foreseeable future.
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