What is income protection Insurance?
Income Protection cover helps you meet your expenses if you aren’t able to work because of an accident, illness, or trauma. You’ll typically receive a monthly payment of up to 75% of your income for a set period of time or until you are able to return to work, depending on your policy.
What types of income protection insurance are there?
Indemnity Value Income Protection: Payment of your benefit is based on the salary you gave when you signed up and the amount is not fixed. Financial checks are required.
Agreed Value Income Protection: Prove your income when you sign up and know exactly what you’ll receive, even if your income changes.
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Before he came to us, Frank was paying for three separate insurance policies that were costing him over $10,000 a year. He was frustrated and disappointed with his insurers but didn’t know where to start.
With the help from one of our Senior Advisers he was able to amalgamate his policies into one comprehensive plan. With a new yearly premium of $6,000, and an insurer that has paid out over $2 billion in claims to Australians over the past two years Frank’s family was better protected and he was paying less.
Frank has since returned to us and we’re helping him with his Income Protection claim. As he recovers from knee surgery this money will help him support his family while he’s unable to work.
After years of paying premiums to the same insurer Maggie found herself in trouble when they suddenly refused to renew her policy. Due to a change in her health and her finances, she was told that no insurers would protect her. That’s when she came to us.
Our advisers were not only able to get Maggie the peace of mind that an underwritten life insurance policy brings; they also helped her save a few thousand dollars on her yearly premium. She was even able to save on her out of pocket expenses by opting to fund the new premium through her SMSF (self-managed super fund).
Maggie is now in the process of upping her cover to include a Trauma Insurance benefit with the help of one of our Senior Advisers.
With our help she’s making the journey from uninsurable to fully protected.
The amount of salary insurance you need depends on your personal situation. What future plans do you and your family have that would be affected by the loss of your income? What percentage of your income would you require in order to make them happen? Compare income protection cover with LifeInsuranceComparison.com.au for an income protection quote on policies that fit into your budget.
Income protection cover insures up to 75% of your pre-tax income in case you can’t work due to illness or injury. Life insurance and income protection work slightly differently, because income insurance benefits are usually paid out monthly as opposed to a lump sum. The monthly benefit can go towards expenses your salary would usually cover, like mortgage payments, grocery bills, or utilities.
Income protection insurance premiums in Australia are usually tax-deductible, so it’s even easier to fit into your budget. With income protection cover, you may be out of commission but your income isn’t. Focus on recovery from your injury or illness without worrying about money. Get an income insurance quote to see what deals are available to protect your salary.
Income protection insurance cost is affected by factors like age, occupation, smoking status, and gender. Statistics estimate that salary continuance insurance can cost between 1-3% of your monthly income, and highly physical jobs tend to have higher premiums.
For example*, insuring 75% of an annual income of $50,000 is $3,125 of cover per month. The average premium for this level of cover would cost a 27-year-old female accountant $52.64, and a 27-year-old male accountant $42.31.
The same level of cover would cost a 27-year-old female chef $67.35 per month on avearge, and a 27-year-old male chef $53.40.
*Figures from CANSTAR 2017 Direct Income Protection Star Ratings
The best income protection insurance offers should meet your needs, offer flexibility, and fit into your budget. When you compare income protection you’ll notice that there are lots of additional benefits available. These can include an optional income protection insurance redundancy benefit or your choice of disability benefit payout period. Some insurers will also suspend your premium while you’re receiving benefits, so you can make the most of your money.
The best income protection insurance Australia can offer you will be personalised to your situation. Income protection insurance reviews can help you make your final choice, but remember that real income protection is effective when it meets your needs, not someone else’s. Visit LifeInsuranceComparison.com.au today for an easy income protection insurance comparison that includes the features you want.
Three levels of income protection insurance
Partial payments for when you are able to work but your income is reduced
Premiums waived for 6 months for women who are pregnant
Indexation, so your benefit will increase in line with inflation
Recurrent disability benefit: No waiting period if the same or related illness or injury happens again
Reward cover benefit: Free accidental death cover of up to $100,000 after 3 or more years of cover
Rehab benefit: If you are totally disabled, this helps cover the cost of rehabilitation for up to 12 months
Unemployment Cover Benefit: If you have a CBA Group loan, this benefit helps cover minimum monthly loan repayments for up to three months.
The definition of cheap income protection cover differs from person to person. However, it is possible to find a low price on cover that will protect your salary should something happen to you.
For example, recent comparisons found that a 35-year-old nonsmoking male office worker with a benefit of $4,000 per month could get premiums for as low as $12.04 per week. For a 45 year old of that status, weekly premiums can be found for $22.59.
There are a few things you can do to find cheaper income protection insurance, such as opting for a longer waiting period and a shorter benefit period. You can also forgo optional benefits in order to keep your premium low, and select only those features that benefit you the most. Don’t forget that premiums are tax-deductible, so you’ll see more savings at tax time.
Get your income protection insurance online quote today from LifeInsuranceComparison.com.au to find cheap cover that offers value for money.
Income protection cover offers a range of benefits that can vary by life stage. For example, a single person in their 20s will have different financial considerations than a parent in their 40s. Below is a broad overview of how income cover can protect you at different points in your life:
Single: Your income is probably going towards things like education expenses, saving for investments or travel, rent, and bills. Income cover can keep you on track as you gain financial independence.
Couple: As a couple, you’ve probably developed a budget based on both of your financial contributions. Income cover can ensure you can stay on top of your expenses, even if you are unable to work.
Children at home: When you’ve got kids, income cover provides the peace of mind that you’ve essentially got a backup income should something happen to stop you from working. Your benefits mean you’ll still be able to pay the bills, childcare, and even save for family vacations, even if an accident or illness puts you out of work.
Children have left home: Many people are thinking ahead to retirement when the children leave home, and being unable to work at this stage can really hurt your budget. Income cover can help you continue to put away savings and cover the day-to-day expenses if you’re unable to work.
Of course, insurance is never one-size-fits-all. Get an online income protection quote from LifeInsuranceComparison.com.au, then have a chat with one of our income protection insurance advisors. You’ll get complimentary financial advice that is tailored to your situation, so you can choose the best low-cost value policy for you.