Locum insurance and income protection: What is the difference?
An overview of the difference between locum and personal insurance, and how they can work together for a business or practice owner - kindly provided by our trusted partners Lloyd and Whyte
Locum insurance
A locum insurance policy can be purchased by and set up in the name of the business or practice. Locum insurance is an insurance policy offering financial support by providing financial benefits should a person named on the policy become unable to work. Primarily this absence would be due to accident or illness, however policies also cover some other causes of absence.
Locum insurance = for the practice
Income protection
An income protection policy is a personal insurance policy set up in the name of an individual, designed to pay a regular income should the policyholder not be able to work because of sickness or disability.
Income protection = for the individual
What cover does an associate dentist need?
A self-employed associate should consider income protection if they are unexpectedly unable to work. BDA partners Chase de Vere has an easy-to-use insurance quote tool to help you explore the right level of income protection for your needs.
What cover does a business or practice owner need?
Locum insurance and income protection can work together. It is common for practice owners to have locum insurance in the name of their business and naming themselves, which would cover the business in the event of their own absence, usually with a benefit period of 52 weeks.
Running alongside this would be their own personal income protection policy set up with a deferment period of 52 weeks to coincide with the locum insurance policy.
Having both policies can be financially advantageous as the longer deferment period under the income protection policy can greatly reduce the overall premium and cost to the individual. In addition to this, having locum insurance in place it protects the business and livelihood of the individual in the first instance and should the injury and/or illness be more severe, then the income protection would respond to cover the individual.
What should a practice owner look for in locum insurance?
Locum insurance policies are traditionally available as either a ‘benefit’ or ‘indemnity’ basis. The key differences are highlighted in the table below. For transparency, this table compares the cover available from our insurance partner, Lloyd & Whyte, to a general indemnity one:
| Benefit | Indemnity |
|---|---|
| No requirement for proof of loss of earnings in the event of a claim | Proof of loss of earnings required in the event of a claim |
| Weekly benefit amount agreed payable in full in the event of a claim | Only amount of losses proven would be payable in the event of a claim |
| No requirement for medical declaration to be completed when you take it out or renew it | Often medically underwritten with requirement for medical declaration to be completed with those names under the policy at inception and renewal. |
Get a quote for locum insurance
You can get a quote for Lloyd & Whyte locum insurance through Allianz Insurance PLC, the coverage includes the following additional benefits which you could compare with others in the market:
- Jury service (equivalent up to 4 weeks benefit or pro rata less than 4 weeks)
- Bereavement benefit (equivalent to 1 week benefit)
- Pregnancy, maternity, paternity or adoption (equivalent to 2 weeks benefit)
- Back related condition cover
- Stress, anxiety, depression, mental or nervous disorder cover
- Family emergency (4 weeks benefit for your partner or dependent children under the age of 18)
- Suspension (while under investigation, the insurer will pay ‘temporary total disablement’ until a final determination is reached, up to the benefit period)
- Benefits will be paid in 4 weekly intervals in arrears, commencing after the expiry of the deferment period.
Conditions under the Lloyd & Whyte benefit policy
Although there is no requirement for a medical declaration to be completed, the policy is subject to the below exclusion:
- Any Accidental Bodily Injury or Sickness caused by, contributed to or aggravated by any Pre-existing Medical Condition.
- A pre-existing medical condition is any physical defect, infirmity, medical condition or sickness for which the Insured Person has been absent from work for at least 5 consecutive days at any time in the two years immediately preceding the Date of Joining.
- A pre-existing medical condition ceases to exist under the terms of this Policy when the Insured Person has not been absent from work for any reason relating to the condition for a continuous two-year period.
Lloyd & Whyte Ltd is authorised and regulated by the Financial Conduct Authority (FCA). The BDA is registered at 124 City Road, London EC1V 2NX. Limited by guarantee (14161) England. 020 7935 0875 | [email protected] | bda.org |