Protection - Part I

02/09/2025

Q1: Won't my employer look after me?

Molly Burd: “We’re finding more and more of our clients move jobs and even change career multiple times during their working life. Each time they do this, they change or potentially lose the protection they had. For clients who become a Partner, start contracting, or become self-employed it’s likely they will lose their benefits altogether.”

Andrew Embling: “The expectation that your employer will look after you in the event of ill-health is not unreasonable. However, whilst many workplaces offer some element of support for when an employee falls ill and has to take time off work, you might get far less financial support than you actually need.”

Q2: What about sick pay?

Molly Burd: “Although sick pay can help cover some of your regular expenses, we find having an additional lump sum to pay out can help ease the burden of having to cope with the major life changes that often occur when someone falls ill. For instance, finding new childcare arrangements or paying for additional help.”

Andrew Embling: “Sick pay can vary from business to business and according to a recent survey, almost half of UK businesses do not provide anything beyond the minimum Statutory Sick Pay (SSP). At £118.75 per week and only paid for up to 28 weeks, SSP is unlikely to be sufficient for many people. Even when a company offers ‘enhanced’ sick-pay over and above SSP, there’s no guarantee they’ll pay you indefinitely if ill-health keeps you off work long-term.”

Q3: Isn't my work insurance enough?

Haydn Brooks: “In a situation like this, it’s actually quite straightforward. Spouses are exempt from inheritance tax, so there would be nothing for them to pay upon your death. This includes if you have left them a life interest. Then once your estate passes to your children, they would pay 40% on everything over and above the transferable nil-band rate of £650,000. Or if they are able to access the full transferable residence nil-rate band, then everything over £1 million.”

Q4: Isn't my work insurance enough?

Molly Burd: “Your workplace benefits are provided on a group basis, so they aren’t tailored to your personal and family needs. Reviewing them with an adviser gives you the chance to make sure the right protection is in place. That way, if you fall ill or pass away, your family’s lifestyle doesn’t have to be affected any more than it already is.”

Andrew Embling: “Some employers offer death-in-service cover, but this only pays out if you pass away – and usually as a multiple of your salary. That may not be enough to clear debts such as a mortgage or to support your family long term. Private medical insurance can help with treatment costs, but it won’t cover everyday bills if you’re off work.”

Stay tuned for part II