International Protection Insurance
Income Protection — Your Income, Protected Wherever You Work
If illness or injury prevents you from working, income protection pays a monthly benefit — typically up to 60–70% of gross income — until you return to work, reach retirement age, or the policy benefit period expires. Unlike critical illness (which pays a lump sum on diagnosis), income protection replaces the income you lose month by month, for as long as you cannot work. For expats — especially the self-employed — it is the only financial safety net standing between a period of illness and financial crisis.
Policy structure
How income protection works — the four key choices
Income protection policies have more moving parts than term assurance. These four decisions define the policy — get them right and you have exactly the cover you need. Get them wrong and you may have gaps that matter at exactly the wrong moment.
Definition of incapacity
This is the most important variable. Own occupation (the best): you can claim if you cannot perform the duties of YOUR specific job. Any occupation (the worst): you can only claim if you cannot do ANY work. Suited occupation is a middle ground. Always insist on own occupation.
Own occupation = most valuable
Deferred period
The waiting period before benefit payments start — typically 30, 60, 90, or 180 days from the onset of incapacity. A shorter deferred period means higher premium but earlier benefit. Match the deferred period to your actual financial runway: savings, employer sick pay, and emergency fund.
Shorter period = higher premium
Benefit period
How long the policy pays. Options are typically 2 years, 5 years, or to age 65. A 2-year policy is cheaper but leaves you exposed if you have a long-term disability. To age 65 is the gold standard — it provides a genuine income replacement safety net for the entirety of your working life.
To age 65 = best protection
Sum insured
The monthly benefit you will receive. Maximum is 70% of gross income for employed; 60% of net profit for self-employed. The limit exists to preserve the financial incentive to return to work. Benefits paid on personally-funded policies are typically tax-free in most jurisdictions.
Up to 70% gross income
The expat case
Why expats particularly need income protection
What you lose when you move abroad
- ✗State sick pay (SSP)Statutory sick pay is only available to UK employees. Expats working abroad have no entitlement, regardless of past NI contributions.
- ✗Employer sick payMost international employment contracts offer basic sick pay or none at all — far less than a standard UK employment package. And it stops when you leave a role.
- ✗NHS support servicesIn the UK, a long-term illness triggers access to NHS-funded physiotherapy, occupational therapy, and rehabilitation. Abroad, all of this is private — and costly.
- ✗State benefitsDLA, PIP, Employment and Support Allowance — none of these are available to UK expats. There is no state income replacement for someone unable to work while living abroad.
The self-employed expat — zero safety net
A UK-based employee who falls ill can expect: company sick pay for weeks or months, SSP after that, and eventually ESA from the state. An expat freelancer, contractor, or business owner who falls ill gets: nothing. Revenue stops. Expenses continue.
This is not a marginal risk. The probability that a 35-year-old is unable to work for more than three months before age 65 is approximately 1 in 3. For a six-month period: roughly 1 in 5. These are not remote scenarios — they are mainstream financial planning risks.
International income protection is not expensive relative to the income it protects. A policy covering £5,000/month for a 40-year-old professional typically costs £100–£200/month depending on occupation, deferred period, and benefit term — less than 3% of the income it protects.
Premium figures are illustrative. Actual premiums depend on age, occupation, health, deferred period, benefit term, and sum insured.
Critical distinction
Own occupation vs any occupation — why it matters
The definition of incapacity used in your policy is the single most important variable in income protection. It determines whether you can actually claim when you need to. Do not buy an any occupation policy — the difference in premium rarely justifies the difference in coverage.
Own occupation definition
You can claim if you are unable to perform the material duties of your own specific job. A surgeon who loses fine motor control can claim even if they could work as a GP or administrator. An architect who suffers severe anxiety impairing design work can claim even if they could theoretically answer phones.
This is the definition that actually aligns with the purpose of income protection — replacing the income from the career you have built. It is available on all quality international IP products we recommend.
Any occupation definition
You can only claim if you are unable to perform any work at all — regardless of how different that work is from your actual career. A solicitor who can no longer practice law but could theoretically sort mail would not meet the definition. A surgeon with a condition that prevents surgery but not administration would not qualify.
Any occupation policies are cheaper — but they are difficult to claim on except in extreme cases. The small premium saving rarely justifies the dramatically reduced coverage. We do not recommend any occupation policies for professional clients.
Planning tool
Choosing your deferred period
The deferred period is the gap between the onset of incapacity and the first benefit payment. It is the most effective way to adjust the premium — but the right choice depends on your actual financial position, not just the lowest premium available.
| Deferred period | Premium impact | Best suited to |
|---|---|---|
| 30 days | Highest | Self-employed expats with no employer sick pay; those with minimal cash reserves; single-income households. |
| 60 days | High | Self-employed with a small buffer; employed expats with limited employer sick pay (under 1 month). |
| 90 days | Medium | Employed with 2–3 months employer sick pay, or those with 2–3 months of liquid emergency savings. |
| 180 days | Lower | Those with significant cash reserves (6+ months expenses) or employer sick pay extending beyond 6 months. |
| 365 days | Lowest | High earners with very substantial reserves and employment contracts providing 12 months sick pay. |
Note: "deferred period" starts from the date you become unable to work, not the date of diagnosis. The two may differ — always confirm the policy wording.
FAQ
Income protection — frequently asked questions
Can I claim income protection if I have a pre-existing medical condition?
It depends on the condition and the insurer. Income protection is underwritten at application stage — the insurer reviews your medical history and will either accept the risk on standard terms, impose an exclusion for claims related to a specific condition, apply a premium loading, or decline cover. A pre-existing condition does not automatically disqualify you, but it will be reviewed carefully. Back problems, mental health history, and musculoskeletal conditions are among the most commonly excluded or loaded risks. We advise clients on how to present their medical history accurately and which providers offer the most favourable underwriting for specific conditions.
What happens when I return to work — does the benefit stop immediately?
Yes — the monthly benefit ceases when you return to work. Some policies include a rehabilitation or partial recovery benefit, which pays a reduced benefit if you return to work part-time during recovery. This is an important feature to check when comparing policies, particularly for conditions where a gradual return to work is medically advisable. If you recover, return to work, and then suffer a recurrence of the same condition, most policies treat this as a new claim — but the definition and waiting period for recurrence varies by policy.
Does income protection pay out if I am made redundant?
No — income protection covers inability to work due to illness or injury only. It does not cover unemployment, redundancy, resignation, or business failure. Some policies offer a separate unemployment benefit as an optional add-on, but this is a different product with different terms. If you are concerned about employment risk as well as illness risk, a combined accident, sickness, and unemployment (ASU) policy may be worth discussing — though the terms are typically less favourable than a standalone income protection policy.
Can I hold both income protection and critical illness cover simultaneously?
Yes, and for most expats we recommend holding both. They address different financial risks: critical illness pays a one-off lump sum on diagnosis of a specified condition — useful for clearing debt, funding treatment, and covering immediate capital needs. Income protection pays a monthly income for as long as you remain unable to work — useful for replacing the ongoing income stream that illness removes. The two products are complementary, not competing. A CI payout does not affect your IP claim, and vice versa, provided the policies are standalone rather than combined products.
What is the maximum monthly benefit I can claim?
For employed individuals, most international income protection policies will insure up to 70% of gross pre-claim income. For the self-employed, the maximum is typically 60% of net profit or drawings, averaged over the previous two or three years. The rationale is that there should not be a financial incentive to remain ill rather than return to work — if income protection paid 100% of income, the calculation changes. Benefits are paid free of tax in most jurisdictions when the premium has been paid personally (rather than by an employer). The maximum insurable benefit and the income evidence required vary by provider and sum — we work through this with clients at needs analysis stage.
Get an income protection quote
Tell us your monthly income, country of residence, occupation, and preferred deferred period. We will compare options across the major offshore providers and come back with a specific recommendation — at no charge and with no obligation.
Get an income protection quote
Tell us your monthly income, country of residence, occupation, and preferred deferred period. We compare options across the major offshore providers and come back with a specific recommendation — at no charge.
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