Personal insurance policies are a wise addition to your financial plan, providing ongoing security for you & your loved ones. Your decision as to whether personal insurance is a smart investment depends on what you want it to do for your family if the unexpected were to occur. To learn more, you can browse the comprehensive policies of Aspect Underwriting and get more insights on the most beneficial policies for you.
As far as insurance is concerned, personal insurance policies are amongst the most popular in Australia. This article primarily focuses on income protection insurance but you may wish to also explore the additional products of accident and death cover, trauma Cover and TPD cover, that provide payment in the event of death, serious illness or permanent disability.
Let’s read further to find out what income protection insurance is and why it’s crucial to own one.
What Is Income Protection Insurance?
Income protection is a policy that replaces most of your income if you become sick or injured. In case you are unable to work due to a medium to long-term illness or injury, , you’ll receive a regular cash payment. However, unemployment is not covered by income protection insurance. Being self-employed or in full-time paid employment is necessary to qualify for income protection insurance.
In Australia, income protection insurance is generally known as either Salary Continuance (SC) or Temporary Total Disability (TTD), but they both offer similar protections.
Why Is Income Protection Insurance Necessary?
In the event of illness or injury, if you do not have income protection insurance, you may have to dip into your savings, sell assets, or request assistance from family or Centrelink. It may be difficult for you to maintain your standard of living or pay for the care and medical assistance you require. Those circumstances can create extra stress for your family and the overall recovery process.
A person’s income is protected when they are unable to work due to illness or injury, and income protection pays an ongoing monthly benefit for a period of time to:
- Help you meet living expenses and repay your debts while still maintaining your lifestyle.
- Reduce or eliminate the need to sell assets to generate cash.
Policies that offer income protection may include options such as:
- The increasing claims option backs inflation-indexed payments
- Rehabilitation and related benefits.
Life is full of uncertainty, and over the last two years, many Australians have been forced to confront that fact. If you have children, family members, or other loved ones who depend on your income, it’s only natural to wonder how they would fare if you could no longer provide for them.
Income protection insurance can help keep those worries at bay. While details differ between providers and policies, income protection can cover a certain amount of your pay for a set period of time if you’re unable to work due to illness or injury. If you’re unsure how to begin researching and comparing policies, consider the best income protection insurance cover from Aspect Underwriting.
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.
