Low-cost family insurance that covers illness or redundancy is being withdrawn by banks and building societies who fear they will be lumbered with thousands of pounds in payouts. Nationwide has pulled the plug on its so-called short-term income protection. And Barclays and Barclaycard lowered the curtain on their deals in November. Thousands have bought the insurance, which is designed to pay out if you miss work through sickness or lose your job.
It works in a similar way to the discredited payment protection insurance (PPI) — only instead of repaying your debts, it covers your salary. Policies cost from £14 to £70 a month — half the price of full income protection — depending on age and health. They typically offer to pay out 60 per cent of your monthly salary for up to 12 months, instead of until retirement as with full protection.....Read more here: Short-term income protection cover axed by banks as they fear payouts worth thousands of pounds