Contributed by William Russell

For most people, the financial security of those you care about depends upon your ability to work and earn a regular income.

But what would happen if you suddenly became too ill to work?

Regrettably, the likelihood of being unable to work due to an illness or injury is greater than you might think. With advances in modern medicine you are more likely to survive a serious illness than die from it, so income protection cover is now as important as life insurance.

* Source: ONS abstract of statistics 2003 Edition

What can you do to protect your income?

Take out income protection insurance - it's simple and affordable.

William Russell Limited has developed a specialist insurance plan for expatriates - the Global Income Protection plan, designed to provide the income you need during a lengthy period of treatment and recovery.

Global Income Protection pays you a regular income if you are unable to work due to a serious illness or injury.

You choose the level of cover that is appropriate to your current income, so that if you become too ill to work, you can still maintain your life-style whilst you are getting better.

Global Income Protection is a sensible, affordable way to help you secure your family's future if you ever need to go through an extended period of treatment and recovery after falling ill.

Most expatriates, employed and self-employed alike, now regard income protection insurance as an essential part of a well-balanced insurance portfolio.

How does the Global Income Protection plan work?

If you are unable to work as the result of a serious illness or injury, your Global Income Protection plan will pay you a regular income.

The benefit paid will be the annual benefit you have insured, provided that this is not more than 75% of the gross annual salary you were earning at the time of your disability, less any other income you are entitled to receive whilst you are disabled.

When can I make a claim?

If you suffer an illness or injury which prevents you from returning to your own occupation for a period of longer than your chosen deferment period, you can make a claim.

What is the deferment period?

When you apply for cover you can choose to start receiving benefit either after 3 months or 6 months from the date you are no longer able to work. If you and your family depend solely on your income, you might prefer a 3 month deferment period.

How much benefit will I receive each month?

Once your claim has been accepted you will normally receive one twelfth of the annual benefit you have insured.

Is there any limit to the amount of benefit I can claim?

Yes, if you make a claim, you will be asked for proof of your pre-disability salary and confirmation of any other income you are entitled to receive whilst you are disabled. The maximum benefit you can claim from your plan is 75% of your pre-disability salary less any other income you are entitled to receive.

Other income includes income you are entitled to receive from another source such as from your employer, another insurance company, or the state, whilst you are disabled.

I am self-employed. How will you assess my pre-disability salary?

If you are self-employed and your earnings fluctuate your average earnings over the past three years will be used.

How long will my payments continue?

Your payments will continue whilst you are totally unable to perform your own occupation, provided you are not following any other occupation.

After you have received benefit for 24 months, payments will only continue if you are totally unable to return to any occupation for which you are reasonably suited by education or training. If you are able to return to a different occupation, even one less well paid, your benefits will stop.

Benefit payments also cease upon death, or upon reaching age 65, whichever is sooner.

What happens if I return to work then suffer a relapse?

If after becoming eligible for benefit you return to work and within six months suffer a relapse, your benefit payments will re-start immediately.

What about inflation?

If you start to claim, your benefit payments will escalate by 2% compound each year.

Do I need a medical?

Many individuals do not need to take a medical, but it depends upon your medical history, age and the amount of income protection insurance cover you apply for. You should speak to your financial advisor about your own circumstances.

If you would like more information on this topic please contact us