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International Group Income Protection

What is International Group Income Protection Insurance?

It’s a form of international sick pay insurance designed to cover employees in a variety of international locations. It works much like a regular income protection scheme, except it can support your workforce wherever they are in the world.  

International Group Income Protection is a benefit growing in popularity for the support it provides employees based in overseas offices and the peace of mind it offers expatriate staff.

International Income Protection is provided via a choice of two products:

  • International short-term disability: provides financial security for employees who are unable to perform their work duties due to an accident or illness. It will pay a monthly percentage of the employee’s salary to the employer, after a deferred period for up to two years.
  • International long-term disability: starts after 24 months from the illness or accident, or when the international short term disability comes to an end. The cover can be as long as the employer chooses, up to a maximum employee age of 65.

Both products are usually used by businesses with staff in multiple locations who want to centralise and harmonise their international employee benefits, and for expatriate staff on assignment around the world.

International Group Income Protection is also commonly referred to as International Business Income Protection, International Company Sick Pay and other variations of.

How does International Group Income Insurance work?

Unlike other insurance schemes, International Group Income Protection rarely comes with a detailed list of included/excluded conditions from the insurance provider. Instead, it offers coverage on the simple basis that an employee is deemed no longer physically or mentally eligible to carry out the functions of their job.

It is up to the employer’s discretion how much of the employee’s salary is covered under International Income Protection, though most insurance policies set a maximum payout limit of 80% of the employee’s wage.

The company will also need to select an initial deferred period, typically either 13 or 25 weeks (3 or 6 months), after which International Short-term Disability would kick in to cover a chosen percentage of the employee’s salary each month. In other words, they will not receive income support until that time. 

Keep in mind, that a company is already obliged to pay the employee Statutory Sick Pay (SSP) for up to 28 weeks.

These are some of the stipulations you can expect to see:

  • The employee must have been an active employee when the event which caused their absence arose. (Note: this doesn’t mean they had to be physically at work at the time!)
  • The employee has been officially signed off as unable to work and has been unable to work for the entire deferred period.
  • The employee is under the care of an accredited medical practitioner and is under the maximum age of 65.
  • The employee is not in any other occupation or in receipt of other remuneration or profit

Note: If the employee is declared fit to work part time only, they can receive a partial payment to support them. It effectively tops-up their earnings. This is usually reviewed after three months.

The International Short-Term Disability benefit will stop when either:

  • The employee returns to work full time
  • The employee reaches the maximum age of the plan
  • The employee passes away
  • The two years cover expires

If an employee returns to work but subsequently relapses, then the payment will resume as before without any additional deferment period, providing that the return to work lasts less than 60 days and that the cause for the new disability/illness is the same condition which previously occurred.

What about International Long-Term Disability?

The details of cover are very much the same as for short-term disability. One key difference is the requirement that, after two years – when long-term disability kicks – the employee needs to satisfy two key points:

  1. They are unable to perform their own/previous occupation
  2. They are unable to perform any suitable occupation, based on their education, skills and experience (in other words, unable to fulfil another role)
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Why do companies need International Income Protection?

There are many reasons that businesses choose International Employee Income Protection as a benefit for their staff.

Employees regularly rate it as one of the most desired employee benefits due to the security it provides both them and their families. Since the Covid pandemic, business income protection has been ranked in the top three most popular benefits for employees on numerous surveys, due to the increasing awareness of the need for financial security in the event of a long-term illness or accident.

However, what is often missed is that International Business Income Protection is as much an employer benefit, as it is an employee one. Some of the reasons why employers rate it so highly include:

  • The reassurance they won’t be left paying an employee’s wages for an extended period of time, or having to make the decision to stop payments, knowing the consequences it could have for that employee and their family 
  • The ability to take decisive action to fill the role with a temporary member of staff without taking a significant financial hit 
  • The high popularity of the benefit, thereby supporting talent acquisition and retention.
  • The ability to provide this benefit when offices, or expat employees, are working in locations which do not offer Business Income Protection locally, or to the same quality
  • The ability to harmonise and centralise Business Income Protection offerings for all their employees and expat staff globally. This means one central contract, one set of paperwork, one renewal date, one set of invoicing and being dealt with in one language. This provide a huge time saving for HR and reduces the need for local HR functions if combined with a wider International Employee Benefits strategy.
  • The ability to help reassure expat employees and their family and meet their duty of care for employees being sent overseas on assignment, without having to source separate expatriate disability insurance.

How much does International Group Income Insurance cost?

There are several factors that come into account when determining the cost of International Income Protection policies. For example:

  • Age
  • Job role
  • Smoker/Non-Smoker
  • Medical history
  • Number of employees covered (the more employees, the greater the discount per person)
  • Coverage provided (i.e. claims period, deferral period and agreed payout amount)
  • Indexing (will you set the payout to rise year-on-year in-line with inflation?)
  • Age-banding (premiums will increase as employer gets older, but it can be set to freeze from the outset)
  • Add-ons offered by insurance provider

In order to get a free quote tailored to your business contact us on +44 (0)1273 974419  or visit our quotes page.

“Engage have provided us with an exceptional service, everything is explained in a very clear, concise and informative manner allowing us to make the right decisions”

Frequently Asked Questions

Is International Group Income Protection a benefit in kind?

HMRC doesn’t treat Group Income Protection policies as a P11D benefit. Monthly premiums, however, qualify as an allowable business expense and so are tax-deductible.

How long does income protection payout for?

Policies offer full-term of short-term payout options.

  • Full-term payout provides for the employee until they can go back to work.
  • Short-term payout covers the employee for a limited time.

You can make multiple claims on each option.

At what point after the policy starts can I include employees?

Once your employee meets the pre-requisites of the insurance, the coverage will then start from the entry date. The entry date can be found on both the quote and the policy.

Do my employees need to undergo a medical examination to be covered?

Generally, not, but do check with your policy provider. However, they usually require an employee’s medical history and/or will be required to fill-in a questionnaire.

What is the difference between International Group Income Protection and international short-term or long-term disability?

They are one and the same. The only difference is the terminology used. International Business Income Protection is split into two products:


  1. International Short-Term Disability
  2. International Long-Term Disability


However, they both do the same thing – providing financial security for employees and employers when a member of staff has an accident or illness and is unable to perform their job.

The only difference between them is how long after the unfortunate event that the payout kicks in. The short-term version can be deferred up to two years after the event, but the long-term product comes into play after two years. See secton ‘What is International Group Income Protection’ for more information.

How much of their salary do employees receive on international short-term disability / expat disability insurance?

As a business purchasing the insurance for your employees, you can choose how much of the salary you are looking to cover. This can range from 50% to 80% although 60 – 80% is more common.

The amount of salary that you cover impacts the premium that you pay.

How much of your salary do you get on international long-term disability / expat disability insurance?

Again, the employer sets this limit, generally between 50% and 80%. If short-term disability is also in place, then the business will decide whether to maintain the same level of protection, or alter it.

What events qualify for International Short-Term Disability / International Business Income Protection?

There are no set qualifying events or a list of illnesses that need to be met for the insurance to kick in, solely that the employee has been declared unfit to perform the duties of their job, and that the minimum criteria for a claim as been met, as per the above points.

What events qualify for International Long-Term Disability / International Employee Income Protection?

As per the above answer for short term disability, there is no set qualifying event or list of illnesses to be met, however the minimum claim criteria will need to be satisfied, as outlined above.

What is the minimum time off for International Short-Term Disability / International Group Income Protection?

There is no minimum time off. However, for a claim to start being paid, the employee would need to be unable to do their job for longer than the deferred period (the point at which the policy is due to start paying out) that has been set on the plan.

What is the minimum time off for International Long-Term Disability / Worldwide Business Income Protection?

International Long-Term Disability would only start after either 2 years, or the end of the International Short-Term Disability coverage, if it had been taken.

What is the maximum time International short-term disability will be covered for?

International Short-Term Disability covers the employee or expatriate team member for up to two years after the chosen deferred period.

What is the maximum time International Long-Term Disability will be covered for?

International Long-Term Disability can provide a percentage of an employee’s or expat employee’s wage right up to the age of 65, should they be unable to return to work due to the illness or injury suffered.

Do other benefits, like International Health Insurance, continue while an employee claims on International short or long-term disability?

This is down to the discretion of the employer, not the policy. Most employers will still fund other benefits for the short term, particularly if they are using benefits like International Health Insurance or an International Employee Assistance Programme to aid their recovery.


In the long term, employers may reduce or stop funding these benefits if they are not actively employed and if it does not breach contract of employment.


The affected employee may wish to use their sick pay in order to invest in these benefits personally – most International Health Insurance providers will offer what is called a ‘continuation option’. This allows the employee to transfer from the company scheme to a personal scheme on a similar level of cover, or less, without any additional underwriting to maintain the coverage you received on the company scheme.

Can an employee apply for new jobs while on International Short-Term Disability / Long-Term Disability / Worldwide Company Income Protection?

Employees and expats can apply for new jobs while receiving International Business Income Protection.


However, should they accept an offer and start a new job it would affect them receiving their monthly pay outs.


The precise impact depends on the work, remuneration, whether they were receiving short or long-term disability, and the rules and processes of the particular insurer.


The employee would be advised to seek out professional guidance and speak to the insurer paying disability insurance before actively looking for a new job to ensure they are not left in a worse position.

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