GENERAL INTEREST: Taking out income protection insurance – the considerations

The need to protect income may occur at many stages of a veterinary surgeon’s career, so deciding whether to take out insurance is important.

Who to ask for advice

The obvious answer is someone who you can trust. It is vital to remember that it is unwise to ask for advice if you are not going to take it. This tends to annoy people and make them reluctant to help you in future.

There is a short list of people who you trust: parents, grandparents, an older sibling, an older member of the profession.

Two people who are unwise to ask are the person selling the insurance and a friend who has just purchased income protection insurance, because he or she is likely to have been influenced by a similar aggressive selling technique.

Role model

I was lucky to have a reliable father who I loved and was my role model. We had an interesting relationship. My father was a farmer, and I know that I have got a very biased opinion of his ability. He was not only a good farmer, but also he was an excellent financial advisor.

When, aged 12, I announced that I wanted to become a farm animal vet, he said, “Oh Graham, you don’t want to be a vet, they are crooks, cranks or conscientious objectors. You want to be a farmer like me and your elder brother.” I will never know, but I suspect he was aware of my character.

This was rather negative advice in 1956, when it was extremely difficult to obtain a place at veterinary school – in fact, after the arrival of James Herriot, it became considerably harder. I think he did not want me to fail, so when I was adamant that I wanted to join the profession and did not take his advice, he did a U-turn and gave me his 100% backing.

Pleasant, but pushy

A very pleasant, but pushy, insurance salesman arrived at Langford. All the lectures were over, and we were revising hard for our finals. He manipulated each of us on a one-to-one interview.

He told us the chances of being in an accident as a vet were very high. He knew all about brucellosis causing arthritis later in life. He then asked, did we play sport? Of course, most of us did. Did we smoke? I didn’t, but both of my parents did.

Did we consume any alcohol? Of course we did. Beer was only one shilling, three pence a pint. I lied and said only occasionally. He cleverly changed our perception. He made us feel that he was giving us a marvellous bargain. He stressed that his insurance was for our whole working life.

This, however, was absolute rubbish, which I only found out many years later when a friend and neighbouring vet had problems with obtaining a payout when he was injured.

The salesman was not offering life insurance, which can be a very good investment when linked with profits. It is vital to remember that income protection insurance is a regular payout, but it is not an investment.

My father would call it dead money. When you take a life insurance policy, you do not have to die to redeem it. I am still alive and I redeemed a life insurance, which my father had taken out when I was only one week old, when I was 30 and bought my first house. It was ironic that my paternal Scottish grandfather, who became a successful butcher in Glasgow, was refused a life policy in 1896, which prompted him to bring his whole family south to Kent to take up farming. He lived until he was 89.

Certain companies issuing income protection insurance are mutual companies, which means the policy owners own the company. With these policies, it may be possible to link protection insurance with equity within the company, so that after some years you can redeem some funds if you cash in the policy. These policies are more worthwhile than a straight-forward income protection policy.

All investment is a risk

You need to decide what risk you are prepared to take and what insurance you are going to take out to mitigate that risk. You may have a partner or spouse who depends on your support. Dependent children are a very important concern. You may have a student loan, but this is not a major concern as, unless you are earning, you do not have to pay any of it back. Of course, a student loan may accrue interest. On the other hand, a mortgage on your home is a major worry. You can take out a specific mortgage against the repossession of your home.

I am certain that my readers will be very much more aware of risk due to the Iran war. The price of gold and oil is rising exponentially. Equities are very volatile, to say the least. Inflation is likely to rise, which makes it unwise to save cash in a shoe box.

Taking out income protection insurance

Let us assume you have decided to take out income protection insurance. You can claim the cost back against income tax, provided it is special veterinary income protection insurance. The cost will be directly related to the amount that you decide you need monthly to claim. This needs to be constantly monitored and adjusted with any rise in your expenditure.

You need to decide whether you are going to claim for loss of income from an illness or an accident. I decided when I was newly qualified that I was a very high risk of having an accident. I was dealing with dangerous animals (I once did a caesarean on a lion) and I flew a light aircraft as part of my job – although this was not half as risky as driving on the appalling roads in Kenya. Most of my time was spent in northern Kenya, which was rated by the Kenyan government as a dangerous area for bandits. I played rugby. I also played cricket, a gentleman’s game and yet a close friend died with a ruptured spleen having been hit in the abdomen by a cricket ball.

I also knew that living in the tropics increased the risk of me contracting a debilitating disease. I did, in my eight years in Kenya, contract a resistant strain of malaria and tick typhus. On both occasions I was hospitalised.

I was obviously a very high risk. The annual premium for income protection was going to be very expensive. The insurance salesman was going to be paid a large fee, as he was selling on an undisclosed commission.

Lowering the fee

How could I lower the annual fee? I got together with my father before agreeing to anything.

Together, we came up with a plan:

• I was employed by the government of Kenya on an aid scheme funded by the UK government. I was entitled to be off work for three months before my salary stopped. I did not require any income protection for this period.
• My father realised that because I was a new graduate, my salary was low and the cost of living was also low. He said that he would guarantee to support me for a further nine months.
• As I was frugal and received a housing allowance, I could live on 20% of my total salary.
• The salesman was forced to reduce the annual fee to a figure that I could easily afford.

The take-home message

Income protection insurance is worthwhile, but it is important to assess your risks and liabilities to reduce the premium.

Points of interest:

• There was an oil crisis in 1974 when I returned to the UK, and the stock market had fallen.
• Luckily, my savings were in government stock, the interest of which was free of tax, as I was working abroad.
• My big error was not buying a house in the UK in 1966. I could have bought a thatched cottage for £400 in 1966. It cost me £20,000 in 1975.

Acknowledgements

I owe massive thanks to my father.

I owe my life to Chaiko, my driver, and Karagoi, my cook, who took me into hospital when I was delirious with malaria in Mombasa in 1967.

• This article appeared in Vet Times (2 June 2026), Volume 56, Issue 22, Pages 12-13.

Graham Duncanson has been a veterinary surgeon for 59 years and has had a great life working all over the world. He has two children of whom he is immensely proud, and they have picked two partners who he finds good fun and very interesting. Graham has three grandchildren whom he finds exhausting, but delightful. He goes walking every day. His hobbies are watching rugby, soccer and athletics, writing textbooks and fiction, travelling and attending veterinary clinical meetings.