Income protection cover good 'in case of emergency'

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Consumers could safeguard their financial future through income protection but disciplined saving is the ideal alternative, an expert has suggested.

Harry Katz, principal independent financial adviser (IFA) of Norwest Consultants, commented that in emergency situations where a person loses their jobs through illness and can't afford to keep-up mortgage payments on the home, income insurance would offer them protection.

But consumers looking to take out such a product should consult an IFA because income protection cover policies contain exclusion clauses where financial compensation would not be provided, Mr Katz warned.

Consumers should work out how much their employer would pay them and for how long in the event of becoming ill, after which they could file for the insurance, he suggested.

State benefits are provided but they dry up after time and vary depending on the person's circumstances, Mr Katz added.

"You have to ask yourself some serious questions - it’s no good laying in bed, watching your debts mount up," he commented.

Around a fifth of Britons currently have income protection insurance, according to figures from AXA.

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