Most people insure their car and their phone but never insure the thing that pays for everything: their ability to earn. Two products fill that gap, and they work in different ways. Confusing them leads to buying the wrong protection.
Income protection
This replaces a portion of your income — usually somewhere around half to two-thirds — as a regular monthly payment if illness or injury stops you working. It keeps paying until you can return to work or the policy term ends. It is built for the long haul, covering the everyday reality of bills carrying on when the wages stop.
Critical illness cover
This pays a single tax-free lump sum if you are diagnosed with one of a defined list of serious conditions, such as certain cancers, a heart attack or a stroke. It pays out on diagnosis, whether or not you can still work, but only for the specific conditions listed in the policy.
The key difference
- Income protection pays a monthly income for any illness that stops you working, for as long as it lasts.
- Critical illness pays a one-off lump sum, but only for named conditions.
Which matters more?
For most working households, income protection is the workhorse — it covers the broadest range of situations and keeps the bills paid month after month. Critical illness can sit alongside it to clear a mortgage or fund treatment, but as a standalone it leaves gaps. Before buying either, check what your employer offers: sick pay and any group scheme change how much cover you actually need.