Will I Still Need Income Protection If I Work From Home?

As a result of the coronavirus pandemic, many Australians have been forced to work from home. In some ways, working from home can be a lot easier and more comfortable, but one thing that many people are confused about is whether they need still need income protection cover if they are working from home.

Every Australian employer must have workers compensation insurance for every one of their employees – it is mandatory by law. Workers’ compensation covers any injury or accident that an employee sustains while they are doing their jobs. This includes working from home or from the office, if you are working you are covered by worker’s compensation.

Even if you are working from home, you are still an employee, and you are doing the same work as you would have done from the office, so you are covered by your employers’ workers compensation insurance. However, some requirements need to be fulfilled.

There are some grey areas in workers’ compensation when it comes to employees working from home. You will only be covered if you are in your designated workspace within your home and if you are doing something that directly relates to your work, during your work hours, when you sustain an injury. However, you will not be covered if the injury is the result of non-working activities.

This is where income protection insurance comes into play and can be a great asset to your life. Income protection insurance sits outside of your workers compensation and covers you if your injury is deemed to be outside of workers compensation coverage. 

Income Protection insurance will allow you to be paid up to 85% of your income, if you are unable to work due to an accident or injury. Income protection insurance can provide more extensive coverage than workers’ compensation.

Some of the perks of having income protection insurance are:

  1. It provides up to 85% of income replacement so that you can maintain your quality of life even if you are unable to work due to illness or accident.
  2. You are covered 24/7
  3. Your benefits can cover you to the age of 65 or 70.
  4. Income protection premiums are tax-deductible, which allow you to take out cover and save at the same time.
  5. Income protection cover is available for those who are self-employed. Self-employed workers are generally not covered by workers’ compensation.
  6. Income protection may provide cover for your medical expenses and help you return to work faster.
  7. Flexible benefit periods and waiting periods.

Workers’ compensation will only cover you if you are injured during your work hours, but income protection will cover you when you are injured or become ill from activities outside of work hours. With income protection insurance, you aren’t just covered for 8 hours a day, you are covered 24/7.

So, having income protection insurance when you are working from home will give you peace of mind that your income is protected, no matter what.

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.