As a small business owner or contractor, you might worry about the potential impact of long-term sickness. In some cases, statutory sick pay and a regular income protection scheme won’t go far enough, leaving you out of pocket and struggling to pay bills.
That’s why we have clients come to us asking about Executive Income Protection. It’s a form of sick pay insurance designed for a single person within a business, but offers greater coverage than a regular income protection policy.
Like a normal Income Protection scheme, it pays an agreed sum to the business which, in turn, pays the sick person via payroll. The amount covered can be up to 80% of an employee’s salary.
However, an Executive Income Protection policy, can also cover dividend payments, pension contributions and National Insurance.
You can find out whether Executive Income Protection is a suitable – and affordable – option by speaking to our independent financial advisers at Engage Wealth Management. You can be assured that we’ll only ever give advice that’s in your best interests.
Get quotes and advice from our impartial policy experts. Arrange a no-obligation introductory call via [email protected] or 01273 076587
We typically work with company directors and contractors, where the loss of income can have a serious impact.
However, Executive Income Protection can be used to cover any key member of your team.
Engage Wealth Management has in-depth knowledge of the income protection market which enables us to explain the intricacies of different policies and providers in straightforward language.
You’ll have ample time to pick the brains of our advisers and get all the answers you’re looking for before making a decision.
We begin by delving into the reasons why you’re considering Executive Income Protection and looking at how you pay yourself through your limited company.
How much of your income comes from salary versus dividends? How dependent is your household on that income? And how would a long-term illness affect both your personal finances and your business?
This first conversation helps us work out whether an executive policy is the right solution or whether another form of income protection may be more suitable.
If you decide to explore things further, we’ll calculate the level of protection your company could provide through an Executive Income Protection policy. We’ll also consider cover for pensions and National Insurance contributions.
Because these plans are set up and funded by the business, we’ll look at factors such as your salary structure, tax position, and the maximum cover insurers allow through company-paid arrangements.
Once we understand your requirements, we’ll research the market and gather tailored quotes from insurers that offer Executive Income Protection.
This type of cover is more specialised than standard income protection, both in terms of cover options but also added extras like virtual GP or second medical opinion services.
You’ll receive a clear recommendation based on our experience and market research, including comparisons between insurers, policy features, waiting periods, and benefit levels.
We’ll explain how the policy works when owned by your company and answer any questions so you can decide with confidence.
If you decide to proceed, we’ll arrange the Executive Income Protection policy on behalf of your company and manage the application with the insurer.
We’ll guide you through underwriting, liaise with the provider if medical information is required, and ensure everything is set up correctly.
Our support doesn’t end once the policy is in place. If you ever need to make a claim, we’ll guide you and your company through the process and liaise with the insurer where needed.
Having an adviser involved can make the claims process far smoother during what can be a difficult time.
As your company grows or your income changes, your protection needs may change too. If you’d like to review your Executive Income Protection in the future, we can reassess your cover and check whether your policy still reflects your circumstances.
“Prior to owning my own home I wanted to make sure that I had sufficient life insurance and income protection in place to financially protect my family should the worst happen...
“Oliver was incredibly knowledgeable on the variety of income protection available and really helped explain them without confusing me... Nothing could have gone smoother or been explained any clearer, really happy with the service I received.”
As well as being experienced in arranging Executive Income Protection policies for clients, our pensions advisors carry the relevant industry qualifications, including the Diploma for Financial Advisers (DipFA) and Diploma in Financial Planning (DipPFS) from LIBF and the CII respectively.
Our advisers also hold qualifications in mortgages, equity release, long-term care and Pension Transfer Specialist (PTS) qualifications.
Engage Wealth Management works with a broad range of businesses, ranging from start ups with 10 employees to businesses employing 1500 staff.
The many positive comments and reviews we regularly receive from our clients is perhaps the best evidence of our expertise as brokers and financial advisers.
Engage Wealth Management previously worked with two founders of a software company who had no income protection policy in place – posing a potential risk to both themselves and the company.
“I highlighted that arranging Executive Income Protection through the company could allow them to secure more cover for themselves and be more cost-effective,” said Luke Comerford, Financial Adviser at Engage Wealth Management.
“This is because Exec IP can cover employers’ National Insurance contributions and pension contributions, on top of their earnings. Neither a Group Income Protection policy nor personal plan would be able to do this.”
This meant they could secure the maximum Executive Income Protection coverage. Not only will both founders’ income continue if they become ill, but their pension pots will continue to grow as well.
Engage Wealth Management featured in VouchedFor’s Top Rated Financial Adviser Guide, as published in The Times and The Telegraph. We’ve also featured in Sussex Business Times (SBT), Citywire, Financial Planner Life podcast and Fund Your Retirement podcast.
Are you looking to better protect your earnings? Contact our professional advisers at Engage Wealth Management via the contact form below.
Related policies: Critical Illness Insurance – Key Person Insurance – Shareholder Protection – Relevant Life Insurance – Income Protection