A recent survey conducted by leading insurers has shown the true value of income protection insurance, with more than half of workers admitting they wouldn’t be able to survive for more than three months on statutory sick pay alone.
There are plenty of employers out there that run their own company sick pay schemes, which are typically far more generous than statutory sick pay packages. Such schemes will usually pay employees a full wage for a number of weeks as set out in the employment package, followed by a period of time on half pay. If workers are still unfit for work come the end of the scheme, they are then entitled to apply for state benefits.
However, research carried out by a leading insurer suggests that for many individuals, company and statutory sick pay is insufficient.
Of the two thousand respondents, 52 per cent of workers said they would be unable to survive financially on statutory sick pay for more than three months, with 30 per cent admitting to not being able to manage for more than a month. Only 9 per cent of respondents believed they would be able to stay in the black for a year or more.
The research also questioned just how much workers knew about the entitlements they would receive. Only 19 per cent were aware how much sick pay they would be entitled to, whilst 26 per cent believed their entitlement would be significantly more than it actually would. 16 per cent thought their entitlement would be double the value they’d actually receive!
A spokesperson for the insurance firm conducting the research, said: “In the present climate, very few people have the savings they need to be able to support themselves and their families for long if they lose their regular income. Employment and support allowance will barely cover a family’s weekly food bill, let alone mortgage repayments and other expenses.