If you’re employed and have a good benefits package, you may already have valuable financial protection in place.

These could include –

• Sick pay
• Death in service.
• Private medical insurance.

Perhaps even Income Protection or Critical Illness Cover.

These benefits can form an important part of your financial safety net.

However, there is one important question that is often overlooked:

Who actually owns the protection? You or your employer?

Rented Protection Versus Owned Protection

One way we sometimes explain workplace benefits is the difference between “rented” and “owned” protection.

Benefits provided by your employer are effectively rented.

You benefit from them while you’re eligible, but they normally belong to the employment package rather than to you personally.

If you leave the company, change jobs or become self employed, some or all of those benefits could disappear.

Personal protection is different.

A policy you arrange yourself is effectively owned by you. Subject to the policy terms and premiums continuing to be paid, it isn’t normally dependent on who employs you.

Neither approach is necessarily better.

The important thing is understanding what you have and what would happen if your circumstances changed.

“I’ve Got Sick Pay Through Work”

This is something we hear regularly.

The next question is – How much and for how long?

Some employers provide extremely generous sick pay.

Others may provide full pay for a limited period, followed by reduced pay.

Some employees may ultimately find themselves relying on Statutory Sick Pay (SSP).

Knowing that you have “sick pay” isn’t quite the same as knowing how well protected you actually are.

It’s worth understanding:

• How much you would receive
• When your entitlement would reduce
• How long payments could continue
• What would happen after they stopped

You can then compare this with your mortgage, household bills and other regular expenditure.

What About Death in Service?

Death in service can also be a valuable employee benefit.

It will typically pay a multiple of salary if you die while eligible for the scheme.

For someone with a mortgage and a family, this could provide an important financial safety net.

However, it isn’t necessarily a replacement for personal life insurance.

If you change employer, the level of cover could change or disappear completely.

You may then decide to arrange personal cover later in life when you are older or your health has changed.

That could affect the cost or availability of cover.

Employer Income Protection

Some employers provide longer term Income Protection as part of their benefits package.

This can be extremely valuable.

If you have it, understanding exactly how it works is important.

For example:

• How much of your income is covered?
• When would payments start?
• How long could they continue?
• Which elements of your earnings are included?
• What happens if you leave your employer?

You may discover that your workplace scheme gives you excellent protection.

Alternatively, you may identify a gap that you hadn’t previously considered.

Private Medical Insurance Is Different Again

Private Medical Insurance can help provide access to private healthcare, depending on the terms of the scheme.

However, it isn’t designed to replace your income if you’re unable to work.

You could therefore have excellent private healthcare through your employer while still experiencing a significant reduction in income during a lengthy period away from work.

This is why it’s important to look at your benefits as a whole rather than assuming that having a good employment package means every financial risk is covered.

What Happens When You Change Jobs?

This is probably the biggest weakness of relying entirely on workplace benefits.

Careers change, people move employers, start businesses, become contractors, reduce their hours or take career breaks.

The benefits available with one employer may be completely different from those offered by the next.

If all of your protection is tied to your employment, your financial safety net can change at exactly the same time as your career does.

Does That Mean You Should Arrange Everything Personally?

Not necessarily.

Paying personally for cover that simply duplicates generous workplace benefits may not always make sense.

The starting point should be understanding what you already have.

Look at your workplace benefits alongside:

• Your mortgage and other debts
• Monthly household expenditure
• Savings and investments
• Your partner’s income
• Existing personal insurance
• The financial support your family would need

You can then identify any genuine gaps rather than simply arranging more insurance.

Combining “Rented” and “Owned” Protection

For many people, the most appropriate solution may be a combination.

Your workplace benefits can provide one layer of protection.

Personal policies can potentially fill important gaps and provide cover that isn’t dependent on remaining with a particular employer.

For example, generous employer sick pay could influence when a personal Income Protection policy needs to start paying.

Good death in service benefits could also be taken into account when considering how much personal life insurance is required.

It’s about making the different pieces work together.

What If You’re Self Employed?

If you’re self-employed, the situation is slightly different.

There is no employer providing sick pay, death in service or other workplace benefits, so understanding your own financial safety net can be even more important.

Ask yourself a simple question:

If I couldn’t work tomorrow, where would my income come from?

For a sole trader, being unable to work could mean income reduces or stops altogether.

For a limited company director, the business may continue to generate income without you for a period of time, but this will depend on how the business operates and how reliant it is on your involvement.

Savings can provide an important emergency fund, but it’s worth considering how long they would realistically last if you were unable to work for several months or longer.

This is where the idea of “owned protection” becomes particularly relevant.

Rather than supplementing benefits provided by an employer, self-employed people may need to build more of their own financial safety net through a combination of savings, personal protection and, where appropriate, protection arranged through their business.

The answer won’t be the same for everyone.

The important thing is knowing what would happen financially if illness or injury stopped you from working and having a plan in place before you need it.

Final Thoughts

Whether you’re employed or self employed, the starting point is understanding what would actually happen if illness, injury or death affected you or your family financially.

Employees may already have valuable protection through work, but it’s important to understand exactly what it provides and remember that it may not follow you if you change jobs.

Self employed people don’t normally have the same workplace safety net, so may need to take greater responsibility for building their own.

For employees, think of workplace benefits as protection you rent and personal policies as protection you own.

For the self employed, the question may be simpler:

If there is no employer providing the safety net, what have you put in its place?

The aim isn’t to arrange as much insurance as possible.

It’s to understand what you already have, identify any genuine gaps and make sure the overall plan remains fit for purpose as your circumstances change.

Information correct at time of writing – August 2026.

Easy Street Financial Services Limited is authorised and regulated by the Financial Conduct Authority. FCA No. 1013595.