You should be able to buy sick pay insurance - often referred to as Income Protection insurance - if you have experienced depression, anxiety or mental illness but there can be limitations. Income protection insurance policies provide you with an income if you are unable to work due to incapacity - mental or physical.
Like most personal insurance products, there is a great deal of merit in speaking to experts to source the best insurance policies at the best prices but reading this article will help you to prepare for what you need and how to approach your search.
In this article, we explain what you need to know about sick pay insurance and depression, including the questions you will be asked, whether you can get the cover and how much it is likely to cost.
How does income protection work?
Income protection provides you with an income if you're unable to work through incapacity. Any mental or physical illness that a medical practitioner certifies as making you unfit to work is usually covered.
Once you are signed off by a doctor, you would present a claim to your income protection provider. Normally, the claims team will write to your GP to verify the claim and will also check that your income has stopped. You cannot claim against an income protection policy if you are still receiving an income.
4 things you'll need to decide when setting up an income protection insurance policy
The deferred period
This is the period between when your incapacity to work starts and when the insurance starts providing you with an income.
The benefit payment period
This is how long the policy will continuously pay an income to you during each claim.
The amount of benefit
This can be up to 70% of your gross income but you should choose an amount in line with what you need.
The term
This is the number of years that you will be insured for.
Buying income protection with depression, anxiety, stress or mental illness
Protecting your income against periods of absence from work caused by stress, depression, anxiety as well as other mental health conditions is important. Especially as they sit amongst the top 3 reasons for claims against these types of insurance policies. Here we summarise how your application for sick pay insurance will be assessed as well as what outcomes to expect.
How to prepare for your income protection application
Your application will ask about your:
- Occupation
- Health
- Lifestyle
Will an income protection insurance company speak to my doctor about my depression, anxiety or mental illness?
Information about your mental health condition isn't automatically requested from your GP. It is more likely that you will be sent a questionnaire to complete. The underwriter at the insurance company is the person who evaluates your application and decides which information to request. Although the underwriters have guidelines to follow, they do take each application individually and assess it as such.
The more information you can provide to the insurance company about your condition, the less likely it is that your GP will be contacted for further information. If you would rather that the insurance company contact your GP for information, you can make this clear and in most cases the underwriter will do this.
What will you need to share about your mental health condition?
You may not have to provide all of the below information but these are the types of details that might be asked for:
- The specific diagnosis provided by a medical practitioner
- The date of your diagnosis
- The date your symptoms began and when you last experienced them
- A description of your symptoms and details of any triggers
- Details of any thought or action relating to suicide or self harm
- What, if any, treatment did you receive / are you receiving?
- Details of any time off work due to the symptoms
What decision can I expect from my application for income protection if I disclose a mental health condition?
There are a few possible outcomes when you apply for income protection and disclose a mental health condition. We have researched the likely outcomes of your income protection application based on disclosures such as stress, depression, anxiety and other mental illnesses.
| Mental health history | Expected decision by the sick pay insurance underwriter |
| No history of mental ill health | If you have not experienced a mental health condition, your income protection will usually provide full protection and will pay out if you become unfit to work due to any type of incapacity including one caused by a mental health condition. |
| History of mental ill health - more than 3 years ago | You may not have to disclose any episodes of mental illness if they are outside the period that an insurance company stipulates in the questioning - questions usually ask about mental ill health within the last 3 or 5 years.
This means that it is unlikely that episodes this far back will have any impact on your application for income protection unless you needed to be hospitalised. |
| History of mental ill health - less than 3 years ago | If you have experienced mental ill health within the last 3 years, it is likely that you will be asked to disclose the details of this.
If you have been fully recovered for 2 years and are no longer on any kind of treatment then you should be offered full insurance cover. If your symptoms are more recent than this then it is likely that you will be offered income protection insurance with a mental health exclusion. |
| Ongoing mental ill health | If you are currently suffering from a mental health condition, you may still be able to arrange income protection insurance but it is likely that the policy will be offered with a mental health exclusion.
This means that you will not be able to claim if you are unable to work due to a mental health incapacity. Insurance can be declined if symptoms are ongoing and/or the impact to your ability to work has occurred multiple times. |
What are my options if my income protection application has been declined or postponed?
The most important thing to understand is that not all insurance companies use the same guidelines and this means that just because your application has been declined by one insurance company, does not mean that it will be declined by all others.
If you did not engage with an income protection insurance expert* who has access to the whole market then this is the first thing that you should do. Income protection experts are well versed in how income protection insurance companies make their decisions. They are also skilled in mental health disclosures and know what information will help your application. It can be difficult to speak about any health issues we face but it can be particularly difficult to speak about our mental health. Speaking to the adviser will reduce the number of times you have to share your information with someone as they will facilitate this for you.
Which is the best income protection insurance company if I have depression, anxiety or mental illness?
Within the income protection insurance market, there are insurance companies that specialise in covering different types of occupations. The best company for you will be a combination of the best company for your occupation as well as your mental health history.
If you are accepted for income protection insurance with an exclusion for mental health, do ensure that the insurance company is willing to review this once you have made a recovery as many companies do review and remove these types of exclusions once you have recovered.
It is not simple to work out which company will give you best outcome for your application as guidelines within companies change from time to time. The easiest and most efficient way to isolate the insurance company that will provide you with the best sick pay insurance as well as the best outcome is to speak to an independent sick pay insurance expert.
Simply fill in this form* and an income protection insurance expert will call you back to discuss the best solutions with you. It takes just a couple of minutes to complete and you're not obliged to buy what is offered to you. You will also receive up to £100 cashback if you do buy your insurance through them.
If a link has an * beside it this means that it is an affiliated link. If you go via the link, Money to the Masses may receive a small fee which helps keep Money to the Masses free to use. The following link can be used if you do not wish to help Money to the Masses and do not wish to qualify for the cashback referred to in the article - LifeSearch
