Why might an individual receive a reduced income protection benefit?

An individual receives a reduced income protection benefit if their employer continues to provide sick pay. Income protection insurance is designed to replace a portion of an individual's income if they are unable to work due to illness or injury. If an employer offers ongoing sick pay during this period, the income protection insurance is intended to act in a complementary role rather than to duplicate what the employer has already provided.

This means that the income payment from the insurance can be reduced to account for the sick pay received from the employer, preventing overcompensation. Essentially, the insurance benefit is adjusted to ensure the total amount received from all sources does not exceed a certain percentage of the individual’s previous salary.