Choosing The Right type Of Income Protection Insurance – What Is Right For You?


Income protection insurance is one of the most important and strategic financial decisions you can make. But like many financial decisions and, particularly insurance decisions, it can be a confusing minefield to negotiate.

How do you choose the right insurance type for you? What is the appropriate level? Will it support my family if the worst happens? How do I choose the best policy and insurer? How do I know whether the policy is good value for money?

All of these questions are important to answer before you make the final decision on insurance. Of course, like anything, the best place to start when you are looking for those answers is an independent expert who is focused on your interests, will listen to your circumstances and needs and help you to identify the right products for you.



So, what are the different types of insurance?

Income Protection Insurance

Income Protection insurance will replace the majority of your income if you’re unable to work due to illness or injury. Protecting regular income is at the heart of sound financial planning. The reality is that you are likely to suffer a health condition at some point in your working career that may take you to a financially challenging place. The question then becomes, can you afford to go for a period of time with no income?


Life cover

Life cover, term life insurance or accidental death cover pays a lump sum to your nominated beneficiaries (such as your partner or family members) in the event of your death.


Total and Permanent Disability Insurance

Total and permanent disability (TPD) insurance provides lump sum cover if you are totally and permanently disabled. It will help cover the costs of rehabilitation, debt repayments and the future cost of living.

TPD insurance will usually apply either if you can’t work again in any occupation, or can’t work in your usual occupation. Each insurer has different definitions of what is and isn’t considered to be totally and permanently disabled so it pays to scrutinise the policy in detail.


Trauma Insurance

Trauma or critical illness insurance is designed to pay you a lump sum to cover immediate medical expenses and other financial needs in the event of critical illness or injury. The most common claims are for cancer, heart attack, coronary bypass, and stroke although most policies will also cover a longer list of other potential illnesses.

In the event a significant trauma did occur to you, there are significant potential financial implications over and above the significant likely medical costs.

Understanding the different types of insurance and determining what is likely to be best for you and your family can be challenging and confronting – these are not discussions that most people want to consider – we all want to think we will stay healthy and strong forever!



However, protecting you and your family against the unexpected is an important financial decision. And it’s not one you should have to make without support. Take the time to talk to an independent expert, like Aspect UW and make the right choice.

Mike Wallis

Mike has over 25 years experience, having spent his first seven years working as a Broker at Jardine Lloyd Thomson in Melbourne and in 2002 was transferred to JLT’s Accident and Health Department in London. For four years (2002 – 2005) Mike was a specialist A&H Lloyd’s Broker and during this time developed excellent relationships with the Lloyd’s A&H underwriting fraternity. In 2006 he returned to Australia in a senior broking position with overall responsibility for Placement Strategy, including the implementation of underwriting facilities and the various authorities granted by Lloyd’s. Mike was the underwriter at two specialist Underwriting Agencies prior to founding Aspect Underwriting in 2016.