Occasional illness is a reality of working life, but too few of us protect our income against long-term sickness.
Brief periods of sick leave to recuperate from passing ailments, knocks and strains are a staple part of any workplace. Of course, occasionally ill health is more long term and employees need to take extended periods of time off work. However, recent research suggests that not only do large numbers of Britons conceal more serious health conditions and fail to take time off – but very few have adequate cover for loss of income.
Research for life insurer LV= has uncovered the degree to which Britain fears taking sick leave and even conceals ill health. The research suggests that as many as 800,000 Britons have concealed a chronic illness – while five million have hidden severe stress or depression.
Certainly, long-term sickness can mean a serious loss of income – even for those with sick pay. Employers are only obliged to pay a statutory sick payment of £87.55 for up to 28 weeks, which, for the average UK worker, amounts to a £430 drop in weekly income. The research implies that almost 40% of workers could have lost income as a result of sickness; and only one in ten of those surveyed had a protection policy to replace income or provide a lump sum if they were unable to work.
So how do Britons envisage that they will provide for themselves and their family in the event of a long period of absence from work due to ill health? Half of those surveyed for LV= said they would fall back on their savings in the event of a loss of income. Worryingly, one in ten admitted that their savings would run out after less than a week. Just one in seven have enough savings to last up to a year. Most households will not have sufficient funds to bridge this income gap for a sustained period – and that includes higher earners too.
But a contingency plan or safety net, such as income protection, which pays a percentage of your lost earnings as a tax-free monthly income for a set period of time, or for as long as you cannot work, can offer peace of mind and allow you to focus on recovery, rather than worrying about paying the bills in the meantime.
To receive a complimentary guide covering Wealth Management, Retirement Planning or Inheritance Tax Planning, contact Tamsin Bromley Rahlke of Bromley Rahlke Financial on 01234 865075 or email firstname.lastname@example.org.