Why take out Income Protection Insurance and what do you need to consider when choosing the right cover for you and your family.

Income protection insurance is strongly recommended for all working people.

It can pay a proportion of your salary if you’re temporarily unable to work because of sickness or injury. 

The length of time you receive payments depends on the contract term; for example two years, five years, or up to age 60 or 65. It varies depending on the amount of cover you are willing to pay for. 

The amount of income protection insurance you need will be determined by the salary you want to insure. Generally income protection provides cover for about 75% of your salary in the event of illness or injury preventing you from working. 

You need to consider what the costs are of meeting a mortgage and other debts; providing for a spouse, children or other dependents; and maintaining your assets and investments. Remember the point of income protection insurance is to provide an income stream if you can no longer work due to accident or illness.

Types of Insurance that Blue Chip Wealth Management can assist you with 

1. Life Insurance – pays a lump sum on your death or the diagnosis of a terminal illness. So when the worst happens, your foresight will pay off the mortgage and other debts, provide for your children’s education, obtain child care and secure your family’s lifestyle. This will allow your family to focus on supporting each other, not worrying about paying the bills. As the years pass they will continue to be thankful you thought ahead. 

2. Trauma Insurance (Critical Illness Insurance) – pays a lump sum on the diagnosis or occurrence of one of a list of specific illnesses such as heart attack, cancer or stroke. That payment gives you choice and flexibility at a time when you need it most. You will be able to reduce your working hours, spend time with your family, get treatment or rehabilitation and pay for a carer and any number of unexpected things. 

3. Income Protection Insurance – provides a replacement income of up to 75% of your current income if you are unable to work due to illness or injury. Also known as ‘Income Replacement Insurance’, ‘Disability Income Insurance’ or ‘Salary Continuance Insurance’, it can cover you for short or long periods and offer various waiting periods to suit your needs. Depending on the policy, payments may continue right up to the age of 65 if the disability is ongoing or permanent. 

4. Total and Permanent Disability Insurance – pays a lump sum if you become disabled and are unable to ever work again. You can use this lump sum to pay off debts, cover medical costs and invest so that you have an annual income to help maintain your lifestyle. 

5. Business Expenses Insurance and Key Person Insurance– business expenses insurance covers the ongoing costs of your business if you are self employed and cannot work due to illness or injury. Key person insurance covers the losses incurred when a person essential to the success of your business is injured, becomes sick or dies.

Call Us today to arrange a no obligation, FREE consultation on 02 8188 0148 and how we can help you get the protection you need.

Photo Credit : Paige Cody on Unsplash 

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