Income Protection Cover: The Basics

I’m always on the hunt for relevant info and I loved this - one of the best articles I’ve seen on this topic for a while. Here are a few paragraphs as a taster... 

Income protection insurance may not be on your radar of necessary insurance policies given it doesn’t have the profile of more common and obviously required insurance policies — you know, like car insurance, health insurance, and home and contents insurance.

Let’s dive in and have a look at some of the basics of income protection insurance so that you can make a better-informed decision about whether or not it’s something you need to be investing in.

First thing’s first, what is it?

 Income protection insurance is essentially a safety net that ensures you continue to earn income when you are unable to work for a period of time as a result of injury, illness or disablement. Income protection enables you to focus on your recovery instead of worrying about how you — and your family — will manage financially while you are physically prevented from earning an income.

What are the policy specifics?

 Income protection policies will vary between insurance providers, but the following are some aspects that tend to be quite uniform regardless of the insurer: 

• Covers up to 75 per cent of your wages (gross)
• Covers those wages for a specific time period of your choice — typically two years, five years or up to age 60 (the latter would be more pertinent in the case of permanent disablement)
• Comes with a waiting period of your choice — waiting period options usually range between 14 days and two years — which is the amount of time you must wait before the insurer will begin to pay your benefit (the shorter the waiting period, the higher the premium)

Pretty valuable stuff, I’m sure you’ll agree! Why not check out the whole article here and share your thoughts with me afterwards: call (0403) 296-221 or email me at [email protected].

Thanks,

Tammie