Income Protection Insurance
The main purpose of income protection insurance is to provide a financial benefit to the policy holder to replace income in the case of inability to work. If the insured person cannot work and support his family because of illness or injury, income protection insurance will provide a monthly payment which can be up to 75% of the total income of the policy holder. The amount can include any benefits that they receive regularly including bonuses, commissions or fringe benefits.
Having income protection insurance gives you piece of mind. In case of unwanted situations where you won’t be able to work for a while, this type of insurance offers financial support to your family. It will help you pay your expenses while you are not capable of working. It can pay for your everyday expenses like food, credit card bills, mortgage payments, educational fees and other short or long term payments.
How Income Protection Insurance Works for You
Before purchasing any type of insurance, you need to understand its scope and how it will work for you. Income protection insurance is completely different from life insurance. You shouldn’t be confused between the two because they provide different benefits. With income protection insurance, you will receive up to 75% of your monthly income as a benefit provided each month (generally) when you are unable to work. Inability to work caused by injuries, sickness or accident are covered by this type of insurance. The insurer provides the benefit until the covered period expires. Coverage for benefits can last from 1 to 6 years or until you reach a certain age, eg 70.
It is ideal to get an insurance policy for income protection with the shortest waiting period, longest benefit coverage, plus more features and benefits that you can take advantage of. Finding the right insurance specialist will help you evaluate the best policy that will work based on your needs and preferences.
Income Protection Insurance that Matches Your Needs
Based on your occupation, you need to find the right income protection insurance to match your needs. The policy should be able to compliment your lifestyle, budget and other benefits you’d like to get in return. Your occupation plays an important role in determining the type of insurance that is right for you. To help you make a good assessment, here are some things to consider.
- Occupational level. Your payments for premiums depend on your occupation. High risk jobs like construction workers are required to pay higher premiums than office jobs. You will be evaluated depending on the risk level you encounter in your everyday tasks.
- The definition of your inability to work. Make sure to discuss with your insurer their definition of inability to work. Coverage varies in different insurance providers depending on their description of policy. Ask your insurer detailed information of the scope when it comes to providing income protection insurance.
For more details about income protection insurance, do not hesitate to contact our insurance experts here at The Money Edge. We will be more than happy to provide assistance and answers to your inquiries.