What is Income Protection?
Income protection Insurance also known as Salary Continuance is an insurance which pays up to 75% of your pre-disability earnings should you become sick or injured. Every person’s needs or wants are different and so calculating the required amount of cover is based on your monthly cash needs.
Why is Income Protection Important?
Income Protection Insurance is very important as it acts as another source of income should you find yourself unable to work due to illness or injury. Generally, people will insure themselves to make sure their lifestyle is not adversely affected by injury or illness. This may mean that you have a plan for savings, paying down a mortgage, ensuring school fees are paid, paying rent, paying bills and almost any expense.
When I claim Income Protection How long does it take until I get paid?
When it comes to income protection every insurer is different however there is a waiting period. These are more often than not 14, 30, 60, 90, 120 days, 2 years or 5 years. When you make a claim you are paid from the end of your waiting period until the end of your befit period. Depending on your occupation, some waiting periods may not be available.
How long does Income Protection last For?
An income protection benefit period is the period for which you can be on your income protection claim and receive a monthly benefit. These benefit periods start at 2 years and range up to age 70 for some insurers. Being on a income protection claim while disabled ensures you have a continued income until the end of your benefit period.
How can I pay for Income Protection?
Generally there are 3 ways in which you can pay for your income protection policy. The first and most common way is to pay using your superannuation, you may already have a policy in place. The second most common way is to pay a portion via superannuation and another amount outside of super. Some people choose this method as this allows the clients to bypass the super funds release rules and can often result in claims being paid sooner. The third option is to pay using cash, some people do this as you can claim the portion paid in cash or outside of superannuation against your taxable income. This is mostly done by self employed people. These options may not be available to everyone and your individual situation would need to be assessed to evaluate your best payment options.
Is Income Protection right for me?
This is a very important and personal question. Establishing your own needs for income protection can be tricky. When configuring the right amount for you some important things to consider are;
- Can I afford to live without an income?
- For how long can a survive before I need my claim to be paid?
- How long do I think I would need cover for?
- How much can I afford to pay for my income protection?
Can I get Income Protection Insurance?
All insurers are different however in most cases when an individual is working they are able to get income protection. The easiest way to do this is to contact WE Insurance and book a quote. This can be done over the phone or by appointment.