Income Protection

Posted on: 22.02.2016

Are you and your family protected? If not is it because you don’t know enough about how you can protect yourself?

Below I have detailed what income protection is and why it is important for everyone to have.

WHAT IS INCOME PROTECTION?
Income protection or salary continuance insurance is cover which replaces your income in the event of you being off work due to illness, accident, or injury. It covers a wide range of conditions, from broken bones to mental illness and is designed to be there in your biggest times of need.

WHY IS INCOME PROTECTION INSURANCE IMPORTANT?
You insure your home, car, contents and the list goes on but the most commonly overlooked asset which people do not insure is their income. In just about every case your income factored out over your working life is by far your biggest asset so you need to ask yourself, if I have my home insured why do I not have my income protected?

Income protection will cover you for up to 75% of your gross income, after you have been unable to work for your selected waiting period (30 days is standard). It will continue to pay you as long as you are unable to work and you can select how long it pays you for (up to age 70). For example if you earnt $100,000per annum and you had the 75% of coverage the amount would be $6,250 per month. You would be paid the $6,250 every month (after your selected waiting period) for as long as your nominated benefit period (you can chose before you take the policy out how long you would need to be paid for).

CAN SUPERANNUATION PAY FOR MY INCOME PROTECTION?
You have the option to pay for income protection from superannuation if you do not want your personal cash funds to be affected.

IS INCOME PROTECTION INSURANCE TAX DEDUCTIBLE?
YES! Income protection premiums are fully tax deductible. If you were to pay them from your superannuation your superannuation fund would claim the tax deduction.

Many people forget that your most valuable asset is yourself, and it is important that you make sure you are covered, especially when you have a mortgage. To get a review of your existing set up or for a no obligation consultation please give me a call today and i will arrange an appointment with our Financial Planner to come out and see you.