Income Protection Insurance

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When you feel healthy and successful you can feel invincible. It’s a nice feeling but have you ever thought about what you would do if you were unable to work for an extended period of time? Most of us don’t expect to need income protection insurance until we all of a sudden do. In this article, I discuss what income protection insurance is and the types of policy available.

Our ability to earn income is probably our greatest asset; however it’s very commonly taken for granted. As injury or illness could occur suddenly and at any time income protection insurance is something that should be carefully considered and treated like any other asset worth protecting. While ACC will cover a large number of injury claims, it is increasingly limited in its extent, and will not cover sickness.

In a nutshell, income protection insurance provides an income in the event of illness or injury that makes return to work impossible. It is suitable for anyone who relies on an income to meet living expenses.

There are two main types of income protection policy. The first is called Agreed Value Benefit, where you can provide financial evidence at the time of application to obtain an agreed monthly benefit. This means that this type of policy is not then financially assessed again at the time a claim is processed. The second type is called Indemnity or Loss of Earnings Benefit insurance which will be calculated based on the income you can provide you were earning prior to ceasing work.

There are a variety of options available as part of an income protection policy. As with all insurance your individual needs will be unique to your personal situation. If you don’t currently have income protection insurance or are unsure what your present cover includes contact me to arrange an appointment to discuss your options.

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