When you take out an income protection policy through IGotCover it’s important that you understand how long your policy can last. The answer depends on the type of policy you choose. Some policies are designed to support you for only a short period, while others can continue to pay out until you reach retirement.
This blog explains the different options, compares short-term and long-term income protection, and helps you decide which may be right for your needs..
What is income protection?
Income protection is a policy that pays you a monthly income if you cannot work due to illness or injury. Unlike Payment Protection Insurance (PPI), which only covers specific debts, income protection replaces part of your earnings so you can continue to pay for your everyday living expenses.
How long does income protection pay out?
Income protection policies vary, but in general, there are two main types:
Short-term income protection
- Pays out for a limited period, usually 1, 2, or 5 years per claim.
- More affordable because the insurer’s risk is lower.
- Designed for people who want some protection but also expect to return to work within a few years.
Long-term income protection
- Pays out until you can return to work, reach retirement age, or the policy ends.
- Provides financial security if you suffer a serious illness or long-term condition.
- Typically more expensive but offers far greater peace of mind.
Policy term vs payout length
It’s important to distinguish between two things:
- Policy term – how long you are insured for (e.g., 20 years or until age 65).
- Payout length – how long benefits continue after a claim (short-term or long-term).
A policy may last until you are 65, but the payout could be limited to 2 years per claim if you choose a short-term option.
Pros and cons of short-term vs long-term
Short-term income protection
Pros
- Lower premiums.
- Provides a temporary safety net.
- Good for less severe health risks.
Cons
- May run out if illness or injury lasts longer than expected.
- Limited peace of mind for long-term conditions.
Long-term income protection
Pros
- Pays until retirement if you cannot work.
- Best suited for serious or ongoing conditions.
- Greater financial security for you and your family.
- Covers all illnesses.*
Cons
- Premiums are usually higher.
How to choose the right option
The decision often comes down to budget and priorities. If you want the most cost-effective option, short-term cover may suit you. But if you want long-lasting security that can protect you against serious illness or injury , long-term income protection is usually the better choice.
Speaking with a IGotCover specialist broker can help you compare policies, weigh the cost difference, and make sure you have the right level of protection for your circumstances.
Final thoughts
So, how long does income protection last? That depends on your policy. Short-term income protection usually pays for 1 to 5 years, while long-term income protection can support you until retirement if you are unable to work.
If you want certainty and real peace of mind, long-term income protection is the option that ensures your income and lifestyle are secure no matter what happens. Speak to IGotCover’s specialists today to find the right policy while you are healthy and eligible.
*Pre-existing illnesses not covered.
