Winter and protection

19th December 2016

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Written by: Contractor Financials

As winter rapidly approaches, the probability of you developing an illness increases dramatically as the temperature drops. From the dreaded flu to colds, norovirus, sore throats and even heart attacks; all these illnesses come to be far more common inside the wintry weather months.

Not only can these illnesses make you feel horrible, but as a contractor it can also cost you a lot of money. As a contractor, you do not have access to sick pay or employee benefits from the Government, meaning taking a sick day or two off to recover from the winter illnesses is a matter of being paid or not.

Many people, whether contracting or not, find they struggle financially while off work sick. Research from First4Lawyers this year discovered that an average person’s monthly bills total £500 – £850 more than the statutory sick pay (SSP) of £350 a month. Thus, three quarters of workers are unlikely to take time off because of loss of income.

With over 4.8 million people in the UK working for themselves many choose not take time off because of the lack of benefits available.

Planning financially for ill health

If you come down with an illness such as a cold or the flu in these winter months, then having a bit of extra money saved up can help pay for the day to day living costs, as well as any medication, food and drink you may need to help with a recovery if you were unwell for a longer amount of time than you expected.

There are, however, ways to protect yourself from the difficulties resulting from an illness.


If contractors are unable to work for a period (usually more than 4 weeks) due to sickness or injury, taking out an income protection policy provides them with a replacement income. This enables them to maintain their current lifestyle without sacrificing their health by being unable to take time off to recover.

Emma Thomson, life office relationship director at insurance specialists LifeSearch, says: “While many take out life cover, there is a much greater risk of falling ill or getting injured than dying early, which is why income protection is so important.”

Income protection policies paid out £9,799 in income to the average claimant in 2015, or £816.58 a month. This could be the difference between meeting vital monthly responsibilities, such as mortgage payments and bills. The success rate of Income Protection claims was 91.2 per cent in that year.

What about developing a Critical Illness?

New research from Scottish Widows has shown that only 7% of contractors have critical illness cover, which will pay out a tax-free lump sum if they suffer a serious health problem such as heart attack, cancer, or stroke (along with many more conditions).

This leaves 4.3 million workers without a financial plan in case of a critical illness diagnosis. Two thirds of those workers are reliant on a single breadwinner and less than 1 in 10 have cover to protect themselves.

Johnny Timpson, protection specialist at Scottish Widows, says: “No one wants to think about disaster striking, but taking out cover will give you peace of mind.”

Is protection the right choice for you?

Income protection or critical illness cover may benefit you and your family if you were to fall ill this winter. The decision to take out protection is usually a matter of your own personal situation, weighing costs of a policy against future risks. However, thinking towards the future will enable you to have a sense of financial security.

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