How much does income protection cost in the UK?
Income protection premiums are priced as a small percentage of the income you insure — usually a low single-digit percentage of the monthly benefit. We explain how that figure is reached in 2026, what pushes it up or down, and how the self-employed and different deferred periods change the price.
The short version
- How it’s priced: as a percentage of the monthly benefit you choose — for most people a low single-digit percentage of the income being protected.
- Typical drivers: your age, occupation class, whether you smoke, your health, the benefit amount, the cover term and the deferred period.
- Cheaper choices: a longer deferred period and short-term (budget) cover both lower the premium; full-term cover costs more.
- Self-employed: usually the same pricing basis, but with no employer sick pay it often justifies a shorter wait and full-term cover.
What moves an income protection premium
| Factor | Effect on price |
|---|---|
| Occupation class | Office and lower-risk roles are cheaper; manual, skilled-trade and higher-risk jobs cost more |
| Age | Premiums rise with age, as the chance of a claim increases over the term |
| Deferred period | A longer wait before payments start (e.g. 13, 26 or 52 weeks) noticeably lowers the premium |
| Benefit amount & term | More monthly income, and full-term cover to retirement, cost more than a smaller, short-term benefit |
| Smoker status | Smokers and recent ex-smokers pay more than non-smokers |
| Health & history | Existing conditions, medical history and sometimes BMI can raise the price or add terms |
Indicative drivers for orientation only — not a quote. Actual premiums are set by each insurer’s underwriting.
Why it’s a percentage of your income
Income protection doesn’t insure a lump sum — it insures a monthly benefit, typically around 50–65% of your gross earnings, paid tax-free while you cannot work. Because the premium is calculated against that monthly benefit, two people who insure the same income can pay very different amounts depending on age, job and health. For most healthy applicants the cost lands in the low single-digit percentages of the income being protected, rather than a fixed pound figure that applies to everyone.
This is different from life insurance, which pays a lump sum on death and is usually cheaper for the same person because it only pays once. Income protection can pay repeatedly across a working lifetime, which is reflected in the premium. Many households hold both: see the income protection hub for how the cover fits together.
Short-term vs full-term, and the deferred period
Short-term (budget) cover pays the benefit for a capped period — often one or two years per claim — and is cheaper. Full-term cover can pay right up to your chosen retirement age for a single illness, and costs more for that durability.
The deferred period is the wait between being unable to work and payments starting. Common options are 4, 13, 26 or 52 weeks. A longer deferred period lowers the premium because the insurer pays out later (and some short absences never reach a claim). The trade-off is that you must cover that gap yourself — from savings or employer sick pay — so align the deferred period with however long your sick pay actually lasts.
What it costs if you’re self-employed
Self-employed people are priced on the same basis — age, occupation class, health and the options chosen — not penalised simply for being self-employed. The bigger difference is need: with no employer sick pay, there is nothing to bridge the gap before a claim, so many sole traders choose a shorter deferred period and full-term cover, both of which increase the premium. Insurers will usually assess income from trading accounts or tax returns, so keep those to hand. For the wider picture, the income protection hub and life insurance section explain how each cover protects a self-employed household.
Income protection cost FAQs
Information only — not financial advice. My Insurance Expert is not an FCA-authorised intermediary and does not arrange or sell policies. Figures are indicative ranges for orientation, not quotes. Last updated: 2026-06-13