For many people, being unable to work is an unthinkable scenario, as it can affect their ability to meet financial commitments and take care of their family.

Unfortunately, for many people this can become a reality, with accidents and illnesses preventing them from going about their daily lives in a normal manner, including going to work. 

In these situations, having a plan in place to deal with the financial side of things can be a major help, and ensure that both individuals and employers alike are better able to deal with the burden. 

What is income protection?

Income protection is an insurance policy that pays out if you’re unable to work due to illness or injury. It can be provided by businesses as a benefit to their employees, helping employers limit their financial responsibilities if staff are off work on long-term sick leave. 

Income protection has no effect on an employee’s eligibility for Statutory Sick Pay, so they are able to receive any claim payment on top of their state sickness benefit. 

Why do businesses need it?

Sometimes, employers are unaware of what their responsibilities are when it comes to paying a member of staff who is off sick. Employees may be eligible for Statutory Sick Pay depending on their circumstances, which is £89.35 a week for up to 28 weeks1, but can receive more if a company sick pay scheme is in place. 

Many organisations do not make provision for unexpected accidents or illnesses, and as a result do not factor in the potential costs of paying an employee who is not actively contributing to the business. 

For the employee themselves, they may struggle financially if they exceed their sick pay period and are only entitled to Statutory Sick Pay – only 9% of people in the UK have some form of income protection in place.2 

With the UK’s employers facing an annual bill of around £9 billion for sick pay – and around 300,000 people falling out of work and into the welfare system because of health-related issues each year3 – the costs can soon mount up for business, but also for employees who no longer have a regular income. 

What are the business benefits?

There are several benefits of protecting staff with income protection cover, the most common being that it can help save the business money. If a member of staff is on long-term sick leave, a proportion of their income is paid by the policy so the employer doesn’t have to pay it. 

The approach standardises the sickness policy, with the income protection element creating a fair and effective policy for the business in the event of a staff member unexpectedly falling ill or being injured. 

Providing your employees with income protection cover offers a valuable staff benefit, and it enables you to ensure staff who are off sick have their income protected which could aid their recovery. 

What options are available?

Sovereign Assured Partners Limited, which is a wholly owned subsidiary of Sovereign Health Care, has chosen to work with PG Mutual to offer Income Protection Plus (IPP). IPP provides a cost-effective solution to sick pay cover from as little as £15 a month per employee, or, if staff are under the age of 30, even less. 

In the event of an employee falling ill or being injured, and being unable to work, they are paid a monthly amount on top of Statutory Sick Pay, helping to save businesses money and cover the cost of additional resources while they are off sick, if needed. 

If an employee falls ill or is injured and cannot work, the claim is handled and the relevant income payment is organised. With the whole process from claim to payment being handled by PG Mutual, both administration time and money are saved. 

Cover can be tailored to suit each business and also tiered to reflect the structure of the team. Different levels of cover can be chosen to suit business needs and ensure an adequate incentive remains for staff to return to work. 

The plan can form a structure for the business’s staff sickness policy, with no penalty for making a claim and no restrictions on the number of claims that can be made. 

Long-term protection is included, with claims paid until the employee is able to return to their work, or until they reach their policy retirement age. 

Furthermore, members can continue their policy independently once they leave the business, taking on personal responsibility for their monthly subscriptions. 

For more information on Income Protection Plus for businesses, insured and administered by PG Mutual, visit


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