Income replacement... The value of protection

The following scenario illustrates how valuable income protection is in providing a replacement salary in the event of a serious illness or injury preventing you from working.

An expatriate with a promising future

In 2000, a 39 year old UK national, takes a job as a Financial Controller in the Far East. The job demands international travel and long working hours in a highly pressurised environment. To protect his income, he takes out a Global Income Protection plan with an insured benefit of $120,000 representing 75% of his annual salary.

The reality

Whilst on a business trip to Thailand, he suffers severe chest pains and breathlessness and is rushed to hospital with a suspected heart attack. He undergoes triple heart bypass surgery which leaves him unable to return to work.
3 months later, with no income, he claims from his Global Income Protection plan and monthly amounts of $10,000 are paid to him from May 2001 onwards.

In May 2002, with the 2% compound interest benefit, the monthly payments he receives are increased to $10,200 per month.

The road to recovery

After 24 months, he is medically assessed by an independent doctor to see if he is able to return to any occupation for which he is suited by training, education or experience.

The doctor confirms that he is fit enough to return to a less pressurised job and shortly afterwards he takes a job with a different firm, upon which his benefit payments cease.

During the period he is off work, we maintain his plan under the waiver of premium benefit and, when he returns to work, we reinstate his cover based on his new lower salary of $60,000.