Quick answer · Updated August 2026
It depends which type you bought. Full-term income protection pays until you recover, return to work, or reach the policy's end age (usually 65–67) — however long that takes; long claims run decades. Budget policies cap each claim at 1, 2 or 5 years for a 40–60% lower premium. The average long-term claim runs over 3 years — beyond every budget cap.
Payout Durations by Policy Type (August 2026)
| Policy type | Pays for | Typical premium vs full-term |
|---|---|---|
| Full-term (to retirement age) | Until recovery, return to work, or age 65–67 — no cap | Baseline |
| 5-year benefit cap | Up to 5 years per claim | ~25–35% cheaper |
| 2-year benefit cap | Up to 2 years per claim | ~40–50% cheaper |
| 1-year benefit cap | Up to 1 year per claim | ~50–60% cheaper |
Multiple claims are allowed on capped policies — each new, separate illness restarts the clock after a return to work.
What the Averages Hide
Most claims are short — weeks to months for injuries and routine surgery, and a capped policy handles those fine. The risk that justifies full-term cover is the minority of claims that run long: cancer treatment, MS, chronic mental health, degenerative conditions. Those are precisely the claims that outlive a 2-year cap, at the moment returning to work is least possible. If full-term is unaffordable, a 5-year cap is a reasonable compromise; 1-year caps mostly duplicate what savings should do. Pair this with the deferred-period decision — our waiting periods guide — and compare providers on the ranking.
Frequently Asked Questions
Full-term policies pay per claim until recovery, return to work, or the policy end age (usually 65–67) — for a degenerative illness that genuinely can mean decades. Budget policies cap each claim at 1–5 years.
Yes — income protection has no limit on the number of separate claims over the policy's life, and capped policies reset the benefit period for each new illness after a return to work.
Long-term claims average over three years — the key fact when weighing a 2-year budget cap against full-term cover.