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Protecting clients against more eventualities: why it’s time to revisit Income Protection

03 April 2017 | LV= News

Your clients don’t have a choice over which life risk they might face or when – life’s nasty surprises can strike anyone - at any time. So, in an ideal world, clients would be protected against more eventualities with a full protection package, combining income protection, critical illness and life insurance. In reality, this isn’t always practical – clients might not get the need to do so or think they can’t afford your full recommendation.

Justin Harper provides guidance on bringing a full protection package to life, cementing your advice expertise and how to make comprehensive cover affordable for clients on a budget.

Just one in 10 people have income protection (IP). Life and critical illness products perform better (but arguably, not good enough) with 2 in 5 adults covered financially against death or critical illness[1]. Yet, whilst overall take up continues to experience moderate growth, we are seeing a steady increase over recent times in multiple sales and full protection plans.

Tools to make it feel real

To help bring to life the importance of a ‘comprehensive protection package’, we recommend talking about scenarios and the likelihood of particular events happening.

A great tool to bring this to life is the LV= Risk Reality Calculator which doesn’t mention ‘products’ and instead focuses on the chances of these events happening. Using just four basic details - age, sex, smoker status and retirement date (which you’ve probably already captured as part of your fact find) you can calculate the likelihood of clients:


Protection solution

Being unable to work for two months or more (due to illness)

Income protection

Suffering a serious illness or injury

Critical illness


Life insurance

The biggest financial risk we’re all exposed to? Long-term absence from work due to illness or injury

Talking about scenarios (long-term sickness, suffering a serious illness) at the beginning of the conversation, then confirming the chances of them happening can make it far easier to then introduce the solution. The calculator also produces a personalised risk report for your client – adding real value to your advice.

Most providers have customer story videos featuring clients (or their loved ones) who’ve claimed under a protection policy. These free and readily available tools are ideal for clients who think “it will never happen to me” or “we’ll get by”. The 7Families stories are still available to share with clients. They’re real, heart-wrenching and at times, inspirational. You can watch the videos at

Top tip: search ‘LV= Risk Reality Calculator’ in Google and visit provider websites for videos you can share with clients to bolster your protection recommendations.

There’s not much point paying off the mortgage if you can’t afford to live in the house

If your client’s diagnosed with a critical illness and has enough capital to pay off the mortgage, they’ll still have the usual bills coming in. The average UK household pays almost £2,000 a month on bills[2] minus the mortgage (utilities, travel and other costs of living).

Personalising IP: add real value not available through direct access or aggregator channels

IP is changing, with many policies in the market including additional benefits and features tailorable for the client. ‘Age-costed’ products are ideal for clients in riskier jobs who can be more expensive to insure. And there are numerous features available to clients working in the public sector, all designed to reduce the price and increase the likelihood of claims being paid:

Medical professionals

  • NHS sick pay guarantees, no HIV exclusions and sabbatical break cover.


  • A special sick pay guarantee where teachers can choose a 12 month waiting period and the policy will flex to pay out earlier based on how long your client’s been employed.

Some providers also include additional benefits, either as part of the contract or as optional extras. These can include fracture cover, lump sum payments on death, hospitalisation benefit, payment of premiums during unemployment or carers benefit.

These features can offer additional financial security whatever life throws at your client and offer more tangible and relevant add-ons for your recommendations, over and above the core financial benefit.

But what about the price?

If income protection, critical illness and life insurance combined prove too expensive for your client, there are ways to bring down the cost:

  • Recommend limited claim pay out period IP (sometimes called budget IP). Just remember to check the policy continues after claim. Typically, these are half the cost of full IP.
  • Suggest decreasing life and critical illness cover (for a repayment mortgage).
  • Reduce the income protection benefit (perhaps in line with mortgage payments).
  • Suggest a longer waiting period for income protection (check to see how long your client’s savings would last and what they would get from their employer).
  • Most providers offer menu plans, which include various protection products bundled together at a reduced price.

Top tip:Although these suggestions might not be ideal, some cover is better than none, so exploring these options are definitely worth looking at.

Win, win, win situation

Recommending comprehensive cover not only protects your clients against more of life’s eventualities, it also mitigates potential complaints against you and your advice in the future. What’s more, including income protection alongside life and critical illness cover will also increase your business revenue.

Guarantee good customer outcomes

Although losing a breadwinner or being diagnosed with a life-threatening condition is devastating, in reality, it’s far more likely a less serious illness or injury will stop your client from earning. And if it does, the financial consequences can be catastrophic. That’s why recommending a comprehensive protection package: income protection, critical illness and life insurance can protect your client against more eventualities and guarantee good customer outcomes.


  • Mintel, February 2017
  • Office National Statistics, March 2016 (published February 2017)

LV=, County Gates, Bournemouth, BH1 2NF, UK