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Income Protection Insurance

Consider this - if your car was written off, would your family survive financially? Would you still be able to pay the mortgage, bills, food etc? Getting around may be difficult but the answer would probably be Yes.

On the other hand, if you were unable to work for 6 months because of illness or injury, what would your answer be to the above question? Most people would cope for a month or maybe 2 or 3, but after that the cash and sick leave runs out. Meanwhile, the mortgage still has to be paid, bills keep coming in ...

And yet, despite this, most people insure their car, but fail to insure their income. It just doesn’t add up.

Statistically many more homes are lost (through mortgage foreclosure) because the main breadwinner has either died, become totally disabled or is temporarily unable to work; than homes that are lost in a fire. Yet again, most people insure their home, but either have no or inadequate Income Protection insurance.

How does it work?

Income protection pays up to 75% of your income if you are unable to work due to accident or illness.

If eligible, benefits are paid after expiry of a chosen waiting period, and continue to be paid for a chosen benefit period or as long as the insured is eligible; whichever is the lesser.

Eligibility depends on whether the insured has met the definitions of total disability or partial disability as specified in the policy document. Premiums differ depending on whether the insured chooses level or stepped premiums, agreed value or indemnity, as well as many other hidden variables.

This is why it is almost impossible for the lay person to compare income protection policies with any degree of accuracy. In fact comparing policies based on sum insured, waiting period and benefit period, is analogous to buying a car sight unseen based on make, model and colour!  One may run like a dream, the other may not even start!

The same is true for income protection policies as the definitions, which can differ considerably, determine whether a claim is payable or not (and isn’t this what REALLY matters?)

Careplan Financial Solutions will do all these comparisons for you, comparing policies from major insurers across Australia to give you the most suitable policy for your needs.

Insuring your income is an essential part of Risk Reduction - and is probably cheaper than you think.

In fact, compared to other types of insurance, it is extremely cost effective...and also tax deductible!

Did you know...

For every home destroyed through fire

there are 4 homes forced to be sold

through death

and 48 homes forced to be sold due to loss of income arising from accident or illness

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The 3 most important things you must know about Income Protection Insurance BEFORE comparing quotes