* Personal Health Insurance - pays a regular income designed to protect your standard of living if you suffer long-term sickness or injury.
Benefit usually starts after an initial waiting period of four, 13, 26 or 52 weeks and is payable until you return to work, die or the policy term expires.
It's called permanent because the insurer may not cancel the policy no matter how often you claim for benefit.
* Critical Illness insurance - this pays benefits on the diagnosis of certain specified critical illnesses.
All policies should cover seven core conditions - cancer, coronary artery bypass, heart attack, kidney failure, major organ transplant, multiple sclerosis and stroke. They will also pay out if a policyholder becomes permanently disabled as a result of injury or illness.
Typically, the benefit - usually between £100,000 and £250,000 - is paid as a one-off lump sum and is tax-free.
How you use the benefits is entirely up to you. They may be used to pay off a mortgage or clear outstanding debts. They can also help to pay for childcare or home help.
* Savings - make sure you have at least three monthsà wages on deposit and are using all tax-free savings options.
* Check your contract of employment - how long are you entitled to take off sick on full/half pay? This will determine what financial precautions you need to take.
