Most people have a plan for where they want to be at specific points in their lives. From university to retirement, we tend to map everything out.
However, there is something that we often overlook: income protection. Income protection insurance is a strategic policy that can replace up to 70% of your monthly income if you are ever unable to work due to an illness or accident.
This means that you and your family will never fall short during unprecedented times. There isn’t much in this world that can provide this level of peace of mind. Let’s take a closer look at what income protection can do for you.
Why is Income Protection Essential for Long-term Financial Security?
What’s so Great About Income Protection Insurance?
So, income protection insurance is a special policy because of its unique payout structure and customisation options. Policyholders can tailor it to work for their specific needs, meaning that no two policies are the same. Here is what you can expect:
- It Replaces Monthly Earnings: Most importantly, it replaces up to 70% of your monthly salary, and in some cases, it can cover more. The amount you receive is chosen by you to ensure you will always be able to keep up with financial obligations and daily living costs.
- Personalised Waiting Periods: If you have savings and would rather wait before receiving your benefit, you can tailor the policy to wait a specific period before it kicks in, potentially saving you a fortune in premiums.
- Tailored Benefit Periods: You can also choose how long you receive the benefit for!
- Ultimate Financial Security: If you have spent years working on your career, you will never need to worry about losing your earnings during unfortunate times. You’ll be amazed at how relaxing your life becomes after taking out income protection.
How to Create the Ultimate Income Protection Policy?
When taking out an income protection insurance policy, there are some considerations worth making to ensure you have the perfect one for you. You will need to think about how much you earn and carefully assess your outgoings.
This will include mortgage payments, bills, lifestyle, and anything else your regular salary goes on every month. Looking into these variables will ensure you can always afford your premiums and the benefit amount will be right for you.
Additionally, if you have money put away, you can use this to determine your waiting period and the length of time you receive the benefit. Sometimes, it makes sense to wait a little longer and rely on savings before the benefit kicks in.
Other considerations to make include indexation to ensure the benefit keeps up with inflation, stepped or level premiums, and agreed value and indemnity. Taking the time to look into these will give you the ultimate policy.
A Quick Breakdown
If you want financial security no matter what situation you end up in, income protection insurance is the way to go.
It can cover the majority of your earnings if you are ever unable to work due to an accident or illness, and can be completely tailored to meet your specific needs. What are you waiting for? Check out income protection and secure your future today!