Aren’t Accident, Sickness and Unemployment (ASU) and Income Protection (IP) cover the same?
ASU and IP are often confused, but they're not the same at all. For most people Income Protection is much better value.
Both policies pay out if you’re unable to work. But whereas ASU offers a limited pay-out to cover mortgage or loan repayments, and then only for 12 to 24 months at most, Income Protection pays up to 70% of your pre-tax pay until you return to work. If you can’t return to work, an Income Protection policy could keep on paying you until you retire.
There are other differences too. ASU is usually sold off-the-shelf – a bit like Payment Protection Insurance (PPI) – so the decision to pay is made at the claim stage rather than defined up front, which means ASU’s successful claim rate is lower. Income Protection is individually-priced to the policyholder up front, and the care taken when setting up the policy means you’ll know exactly what you claim for.
This isn’t to say ASU is never the right policy to choose (Income Protection rarely includes Unemployment Cover, for instance, so if this is something you’re specifically looking for, ASU might be worth a look) but as a rule, we’ll only recommend ASU under certain circumstances.
According to WHICH? Income Protection is “The one protection policy every working adult in the UK should consider”
Since 1998, happy LifeSearch teams have protected more than 640,000 UK families
- Fee-free expert advice, free support services
- We hunt the market: insurers you know and some you don't
- We advise, we search, but you decide
- Over 80 awards and a super-high TrustPilot score
- Top #3 in Sunday Times Best Places to Work