It is difficult to protect oneself and the loved ones against the uncertainties of life. However, a wide range of insurance policies are available that can be useful financially in the event you have lost your ability to work through serious illness, injury or accident.

Quick Financial Check
Dig through your records and rumble through your paperwork. Chances are you may already have something that you have forgotten about. This could be a mortgage payment protection policy (MPPI) that you took out when you arranged your mortgage. Check out your (and your partner's) earning capacity as well as check with your employer(s) what protection they would offer in the event of illness, especially long-term illness. Add up any savings you have. Now you should have an idea of how much money you may require in the event you or your partner or both together are unable to earn for a time or pemanently.

Income Protection Insurance
The main type of insurance to cover your income if you are unable to work through sickness, accident or injury is income protection insurance, also known as permanent health insurance (PHI). This pays out a regular tax-free income (normally 50-65% of your earnings). Depending on your occupation or type of work you do, payments usually start after a deferred period of between four weeks and a year, during which time you'll need to depend on other resources. The longer your deferred period, the lower your premiums. Income protection can be expensive. The premiums you pay will depend on your age, the type of work you do (low risk or high risk of injury), the amount of cover and the deferred period.

Covering sudden ill health
Critical illness insurance pays out a single tax-free lump sum if you're diagnosed with one of a defined list of serious or life-threatening conditions. Policies vary but typically the list will include cancer, heart disease, stroke, multiple sclerosis, and total and permanent disability. This cash can help ease financial worries for you and your family while you are being treated, which, in the event of a serious illness, can be a lengthy process. You could use the cash to pay off a large debt such as your mortgage. The younger you are, the cheaper this cover costs, because the less likely you are to develop a serious illness. It's best to see this policy as an addition to permanent health insurance (PHI)/ income protection insurance. It doesn't pay out for accident or injury or many common problems such as back trouble or stress, only serious illness. Always make sure you know which illnesses are covered and which ones aren't.

Covering your mortgage
If you simply want to be able to pay your mortgage if the worst happens, you can take out mortgage payment protection insurance (MPPI). MPPI - also known as accident, sickness and unemployment insurance (ASU) - offers peace of mind by paying off your mortgage if you are unable to work following an accident, sickness or unemployment. It usually only pays for 12 months (occasionally 24 months). Rates vary enormously, so if you want the cover always shop around and don't just opt for the policy your mortgage lender offers. Always check the exclusions (the things that aren't covered) when comparing policies. Compare prices too with permanent health insurance (PHI), which may offer a better all-round deal.

Debt protection
Payment protection insurance is designed to cover the cost of personal loan repayments or minimum monthly credit card payments if you are ill and unable to work, or are made redundant. If your debts are small or you could cover repayments using savings or help from relatives, this might be an unnecessarily expensive option. Look hard at accident insurance You get often get personal accident insurance offered free to encourage you to buy other financial products. So don't be surprised that what's covered may be limited. Some simply pay a modest lump sum if you suffer an injury specified in the policy such as the loss of an eye or a limb as the result of an accident. Look for what's not covered.

In Conclusion - The options
Replacing income can be an expensive business, so think carefully about which type of insurance best suits your financial situation. If you're not sure then seek independent financial advice before signing on the dotted line.