Fees, advances and royalties
A writer's income rarely arrives in a tidy monthly salary. Copywriters bill per project or day rate. Authors receive an advance split into stages, then royalties twice a year if the book earns out. Many mix the two with teaching, editing or ghostwriting.
For income protection, insurers ask what you would lose if you could not write. Fees for future work count. Royalties on books already published might keep arriving, so some insurers leave them out of your insured income or deduct them from a claim.
Journalists on a staff contract are in a different position. They usually have employer sick pay and sometimes death in service, so cover can be set to start when those benefits end. Freelance journalists paid per piece are closer to self-employed authors.
How an insurer reads uneven years
A year with a large advance can make your income look high, and the following lean year can make it look low. Insurers typically look at the last two or three years of tax returns to find an average.
Be realistic when setting your benefit. Insure an amount you could show from your accounts, since an inflated figure would be cut back at claim time and you would have overpaid for it.
If you are working on a book with a large advance due on delivery, think about what happens if illness delays the manuscript. Income protection pays a monthly sum while you cannot work, which gives you time to recover without rushing back to meet a deadline.
- Keep publishing contracts and royalty statements
- Separate fee income from passive income when you talk to us
- Include regular teaching or editing work
Desk work, health and the incapacity test
Insurers group occupations into risk classes, and writing usually sits among the lower risk desk jobs. That helps with price and makes own occupation cover easier to get, which pays if you cannot work as a writer.
The illnesses that stop writers tend to be mental health problems, long-term fatigue, back or wrist trouble and serious illness. Your cover should handle all of these, so we look at how each insurer approaches mental health claims.
Long hours alone at a desk can also feed into weight and blood pressure, both of which insurers ask about. A health check before you apply is no bad thing, and honest answers keep your cover sound.
Waiting periods and life cover
Writers with savings from a good year often choose a longer deferred period, such as thirteen or twenty-six weeks, to cut the premium. If you work invoice to invoice, a shorter wait brings quicker help.
Life insurance pays a lump sum to your family if you die during the term. It is worth thinking about your literary estate too: future royalties pass under your will, so speak to a solicitor about how they are handled.
What Hi Tomorrow does for writers
We sort out which parts of your income insurers will recognise, compare policies that suit irregular freelance earnings and help with the application. If your history makes income protection hard to place, we can talk through life and critical illness cover as alternatives.