Income Protection Calculator
Calculate how much income protection cover you need. See what happens to your income after employer sick pay and SSP end, estimate premiums by age and occupation class, and view a month-by-month sick pay timeline for up to 24 months. Uses UK 2025/26 SSP and benefit rates.
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How to Use This Calculator
Coverage Needed tab
Enter your annual gross salary, monthly essential outgoings (mortgage/rent, bills, food, debt repayments), and your employer sick pay terms (weeks at full pay and half pay). Add your available savings. The calculator walks through each phase of income loss — employer sick pay, SSP at £118.75/week, then ESA/UC or nothing — and shows the monthly shortfall at each stage. It recommends a benefit amount based on your expenses and the 50-70% of gross income range.
Cost Estimate tab
Enter your age, occupation type (class 1-4), desired monthly benefit, deferred period (4-52 weeks), and policy term. The calculator shows an estimated monthly premium range, annual cost, cost as a percentage of salary, the benefit-to-premium ratio, and the breakeven point (how many months of claiming it takes to recover all premiums paid). Compare premiums across all five deferral periods at a glance.
Sick Pay Timeline tab
Enter your monthly take-home pay, employer sick pay terms, and savings. The calculator builds a 24-month timeline table showing exactly what happens to your income each month: from salary, to employer sick pay, to SSP, to ESA/Universal Credit. Each row shows the income source, monthly income, monthly shortfall, and cumulative shortfall. See when your savings run out and how the gap grows over time.
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The Formula
Income protection replaces your income if you cannot work due to illness or injury:
SSP (2025/26) = £118.75/week for up to 28 weeks (from day 4)
SSP monthly equivalent = £118.75 × 52 ÷ 12 = ~£515/month
Monthly shortfall = Essential outgoings − income while sick
After SSP ends (week 28+):
UC standard allowance = £393.45/month (single 25+)
UC couple allowance = £550.67/month
Income timeline when off sick:
Phase 1: Employer full pay (varies by contract)
Phase 2: Employer half pay (varies by contract)
Phase 3: SSP only — £118.75/week for remaining weeks (max 28 total)
Phase 4: ESA/Universal Credit or nothing
IP payouts from a personal policy are tax-free. This means 50-70% of gross income approximates your normal net take-home pay. If your employer pays for the policy, payouts are taxable as a benefit in kind.
The deferred period (waiting period) is how long you must be off work before the policy starts paying. Common options are 4, 8, 13, 26, or 52 weeks. Longer deferral = lower premium. Match your deferral to your employer sick pay + savings buffer.
Occupation classes affect premium cost: Class 1 (office/professional) is cheapest; Class 2 (light manual); Class 3 (skilled manual); Class 4 (heavy manual) is most expensive.
Example
Sarah — Project Manager, £40,000/year
Sarah earns £40,000 gross (~£2,600/month take-home). Her employer pays 4 weeks full sick pay then 4 weeks half pay. Her essential monthly outgoings are £2,200 (mortgage, bills, food, car). She has £6,000 in savings. Her partner earns £1,800/month.
What happens when Sarah cannot work
The income gap
With income protection
Sarah takes out IP for £1,700/month (roughly 50% of gross, close to her net pay) with a 13-week deferred period. Her employer sick pay and savings cover the first 13 weeks. After that, IP pays £1,700/month tax-free until she recovers. Estimated premium: ~£35-50/month for an office worker aged 35. That is about 1% of her salary for complete income protection.
Without IP, Sarah would exhaust her savings by month 5 and face a growing cumulative shortfall. With IP, her income is replaced from week 13 onwards.