Insuring yourself against accidents and sickness

[contractor79]

Let's chat about insurances.

If you pay for sick pay insurance and you're on the bench then it appears you cannot claim for sickness benefits. They only apply when you are working. So if you're not on a contract and not paying yourself a salary then don't waste your money paying for these things.

So how does a contractor on the bench insure himself/herself against accidents, sickness that would mean you cannot take up a contract?

An awful scenario would be to get seriously ill or suffer an accident whilst on the bench and uninsured. Would be nice to get an insurance to pay out to pay off the mortgage if that happens. Then live on own money and/or state benefits, I guess?

I'm trying to look for suitable policies but they're hard to find. Could perhaps take out some kind of personal accident cover and/or critical illness cover, maybe also life cover if you have dependents.

Any tips?

[ChrisPackit]

I have a policy like this with Aviva which offers £2500 per month in the event of long term sickness - You can specify as much or as little as you want up to a ceiling of £5K I think. I asked the same question when I took my policy out and obviously I am employed by my Ltd regardless of whether the company has work on or not. They are happy with this arrangement - though I have never had to claim yet! It costs me a little over £40.00 a month out of interest.

Chris

[SueEllen]

You need to talk to an IFA It's called PHI and you can only get proper PHI via an IFA.

You can get policies that pay out for up to 2 years without using one but in reality you want one that pays out until you retire if you get that sick and doesn't try and force you into taking any job.

Your limited company should be paying you a salary whether you are in a contract or not then you will be covered.

Life insurance you can buy separately and has apparently got cheaper over the years due to the increasing longevity of the UK population.

BTW with sickness and accident insurance it cost more being female than male. So to all those men who complain about the difference in car insurance due to gender this is one insurance where you win as you are less likely to claim if you have it.

[Fred Bloggs]

I bought PHI directly from Friends Provident that pays £1500 a month till my retirement date, I nominated age 62. Both the benefit and premium go up every year by RPI. The cover was specifically for if I couldn't do my NORMAL job. This was significantly deaer but a lot better cover. Note that IIRC, a payout from policy like this is not subjected to income tax as it not income, it is an insurance claim. HTH.

[SueEllen]

You guys must have taken out your policies ages ago because looking at Friends Provident pages here - Friends Provident - Next steps

They state you have to go to a Financial Advisor to get them to submit the application forms for Protection.

I remember looking when I wanted to take mine out (after I got a mortgage) and I couldn't find away to go direct with any firm.

There are firms who don't give you advice but just give you quotes.

[Fred Bloggs]

Yes, possibly, fair enough. It is worth paying the extra for the cover if you can't "do your normal job" IMO though.

[filthy1980]

in the process of setting one up now through an IFA, around £40 p/m will pay out 4300 p/m if i'm sick or injured and not able to perform MY job

and like someone else stated above doesn't matter whether you're on the bench or not, you are employed by your limited whether they have cashflow or not doesn't make a difference to you the employee

[Dearnla]

Be careful to sign up for one that pays a fixed amount, not what you actually get paid. A friend of mine was laid up for a while and was only receiving his minimum wages - it didn't cover Dividend payments, for him or his missus.

[filthy1980]

Be careful to sign up for one that pays a fixed amount, not what you actually get paid. A friend of mine was laid up for a while and was only receiving his minimum wages - it didn't cover Dividend payments, for him or his missus.

cheers

will double check the conditions when i get them through