"Accident-only protection isn’t about cutting corners. It’s about providing a practical, immediate solution for people who might otherwise fall through the cracks."
Income Protection (IP), and the safety net it provides for those unable to work due to ill-health or injury, is increasingly recognised as fundamental in financial planning. Yet, when it comes to Accident Only Income Protection (AOIP), it’s sometimes met with scepticism.
“Is this even a real product?”
As a specialist provider committed to helping customers access affordable protection, we recognise AOIP as not only a legitimate product but a vital stepping stone for those who would otherwise remain entirely unprotected.
AOIP does ‘exactly what it says on the tin’: financial support if you are unable to work following an accident. Unlike IP policies, it doesn’t cover absence due to ill-health. That limitation is openly communicated and doesn’t make it an ‘inferior’ product.
READ MORE: Why do conversations about IP tend to focus on extreme scenarios instead of everyday accidents?
Our ‘Bruised Britain’ consumer study found nearly a third (29%) of adults have experienced an accident in the last three years. Of those, over half (57%) had to take unplanned annual leave. Accident-related concern is especially apparent amongst those in high-risk occupations, such as construction, transport, and manufacturing.
“We view accident-only products as a gateway, not a final destination.”
AOIP gets customers (especially those with pre-existing conditions) thinking about financial planning. For many, traditional IP plans are unaffordable or feel out of reach. This is especially true for the self-employed, young professionals, and manual workers.
Our research found that those aged 35 or younger are more likely to take out AOIP than any other age group, with 51% having cover in place to protect their income. This compares to 28% of those aged 35-54 years old, and 14% for those aged 55 or older.
READ MORE: National Friendly highlight age-related risk discrepancies for everyday accidents
At the moment, price sensitivity is high, and underwriting can be challenging for those with pre-existing conditions. AOIP is more accessible and allows for significantly lower premiums.
In other words, accident-only protection isn’t about cutting corners. It’s about providing a practical, immediate solution for people who might otherwise fall through the cracks.
“AOIP isn’t just real, it’s responsible.”
Regulators have rightly urged providers to serve diverse customer needs, and accident-only products are included in that mandate. We see it as part of our mission at National Friendly to democratise protection.
We’re not suggesting that AOIP is a substitute for IP. It isn’t. But that doesn’t mean it has no value. Just as Critical Illness Cover (CIC), Term Life Insurance, and budget dental plans serve a purpose, so too does this product.
The question shouldn’t be whether AOIP is a real product, rather, is AOIP suitable, accessible, and helpful for the people who need it?
