This guide is written for UK policyholders who want a complete, independent answer, without scrolling past sales banners. We do not sell income protection insurance and do not receive commission from any insurer named below.
Below we walk through the underwriting fundamentals, typical UK price ranges, named exclusions, and questions to ask before binding cover. Every figure is sourced.
The short answer, expanded
Independent UK answer to "what it covers income protection insurance", written by InsuranceDico's editorial team and fact-checked 2026-04-15. In the rest of this guide we explain why, and the conditions under which the answer changes.
What's actually covered
Standard UK policies in this category cover sudden, accidental, and unforeseen events. Insurers distinguish between indemnity and new-for-old, read the schedule carefully.
- Third-party injury and property damage you cause to others
- Defence costs incurred to investigate or defend a claim
- Court-awarded compensation and agreed settlements
UK premium ranges, by profile
| Profile | £1m limit | £5m limit | £10m limit |
|---|---|---|---|
| Sole trader, low-risk | £60 | £120 | £220 |
| Sole trader, medium-risk | £100 | £180 | £310 |
| SME (5 staff) | £140 | £240 | £400 |
| SME (25 staff) | £180 | £300 | £490 |
