Personal accident and sickness insurance: what it is and why you need it

When thinking about insurance for your business, it’s all too easy to overlook a crucial risk. You’ll have contractors liability cover, tools cover, even cover for a van or workshop, but what about cover for you?

If you had an accident, or left unable to work by injury or illness, how long would it be before paying the bills became a bit of a struggle?

The good news is it’s very easy to defend against these kinds of scenarios. Personal accident and sickness insurance is a simple cover designed to pay out a lump sum if an accident strikes, or protect your monthly income in the event you suffer illness or injury that prevents you from working.

What is personal accident insurance?

Also known as accident protection insurance, personal accident and sickness insurance does what it says on the tin.

The personal accident element pays out a lump sum if you’re injured in an accident, while short-term income protection covers things like mortgage payments, household bills and food for up to 12 months while you’re unable to work.

What does personal accident and sickness insurance cover?

In simple terms personal accident and sickness insurance covers accidents or illnesses that prevent you from working, stepping in to pay out a lump sum in the event you suffer a serious injury, or helping to replace monthly income if accident or illness keeps you from working.

What’s more, personal accident and sickness insurance doesn’t just cover accidents or illnesses suffered while working – it can help with the bills while you can’t earn, even if you’re injured while away from work.

What if you take a nasty tackle while playing for your Sunday League football team? A bad injury could keep you away from the coalface for weeks. Similarly, a back injury on the golf course could just as easily mean a long lay-off.

Sport is not the only hobby that brings risk of course. All manner of seemingly innocuous mishaps can end in disaster. A DIY accident, even a slip of the bread knife could leave you with an arm in a sling and unable to work.

Then there are the things that just happen randomly. If you’re involved in a car accident or come down with a nasty, lingering bug – glandular fever or pneumonia for instance – you could be away from the tools, cancelling jobs and worrying about money in no time.

Whatever the cause, the added stress and worry that comes with lost income is unlikely to speed up your recovery and could even force you back to work before you’re truly ready.

Does personal accident and sickness insurance cover self-isolation?

The first thing to highlight is that the cover provided under personal accident and sickness insurance varies from policy to policy and provider to provider. So, if a particular coverage – like self-isolation – is important to you, always check the policy detail before buying.

That said, most personal accident and sickness insurance policies will only pay out if you experience loss of income when you are out of work through illness – so, for instance, self-isolation that is not medically advised is unlikely to be covered. However, policies may well pay out if self-isolation is accompanied by COVID-19 symptoms that leave you unable to work, and you suffer lost income as a result.¹

As always, it is best to check the details of your policy with your provider – you can contact NICEIC Insurance on 01133960346, or request a call back here.

How much personal accident insurance should I have?

The level of personal accident and sickness cover you need really depends on your circumstances – and, crucially, the level of financial support you might need if you are unable to work for a prolonged period by accident, injury or illness.

Typically, personal accident and short-term income protection insurance is available as pre-defined levels of cover – with each level offering progressively more cover – and this can make working out how much cover you need reasonably straightforward. Think about how much income you might need to replace in order to cover monthly bills and select a level of cover that provides at least that much protection.

It is also important to think about the length of cover you might need – that is, how long a policy will continue to help with lost income while you are injured or ill and unable to work.

At NICEIC Insurance, we offer two levels of cover of contractors personal accident insurance and short-term income protection. It is designed to pay out a lump sum if you suffer an accident, or protect your income for up to 12 months.² Our specialists are also on hand to help you work out what level of cover you need and secure an appropriate policy quickly.

Is personal accident and sickness cover worth it?

Again, this is a personal decision, but maybe a more useful question is “If I am unable to work through illness, how long would I be able to pay the bills?”.

The bottom line is, it’s easy to think “it won’t happen to me”, but that’s exactly what insurance is for; to protect your livelihood against the unexpected.  So, if you think a period of time without your normal income could leave you in serious financial trouble, personal accident and sickness cover is definitely worth a closer look.

Personal accident and sickness insurance for self-employed contractors

This may be particularly true in the case of personal accident and sickness insurance for self-employed contractors. After all, your income as a self-employed contractor will be entirely dependent on your ability to work – and, if you are self-employed, you may not even be entitled to statutory sick pay.³

At the end of the day, this is about peace of mind – knowing you can keep the red bills at bay while you take the time you need to recover – and, at NICEIC Insurance, we’re ready to help.

We know finding the right cover can be time consuming, even confusing, so our expert advisers are here to guide you to the cover that’s right for you – effective and affordable – so you can get on with your life with one less thing to worry about.

This important protection can be added on to your existing contractors cover with us – for as little as £12 per month plus insurance premium tax (IPT) for personal accident alone, or £52.80 per month plus IPT for combined personal accident and short-term income protection cover.

Note: IPT is currently 12% as at April 2019. 

To find out more, please click here or give us a call on 0333 015 6629.

1. abi.org.uk/income-protection 
2. In order for cover to be valid, you must be off work for at least the qualification period and be signed off work by a doctor 
3. thetimes.co.uk/benefits-sick-pay-self-employed