Income protection insurance is something that can be considered for almost anybody earning an income.
Income protection insurance can help safeguard your quality of life and help cover expenses if you were unable to work due to sickness or injury.
Plan for the future
You can’t predict the future, but you can plan for it. Nobody wants to think about the possibility of having an accident or getting sick, but it’s a very real possibility that could impact your ability to work.
It’s estimated by the Heart Foundation that cardiovascular disease affects around 4.2 million Australians. It’s also estimated more than 400,000 Australians have had a heart attack at some point in their lives. And cardiovascular disease is just one health issue. When you consider the injuries and illnesses that can affect any number of Australians, the reasons to consider protection aren’t insignificant. While it’s important to maintain a healthy lifestyle to help protect against illness or injury, we can’t control everything that happens in life. So having a plan in place in case something happens to you can be a good idea.
It’s not about how much you earn
One of the biggest myths surrounding income protection insurance is that only high-income earners need it. However, almost everyone who is part of the workforce can benefit from the peace of mind afforded by income protection. Regardless of how much you earn or what life stage you’re at, the loss of your income can have a huge impact on your ability to live your life and pay your bills.
What’s important to consider is how you and your family would cope if you were unable to bring home the anticipated pay cheque, particularly if it was for an extended period of time.
Parents in particular have a responsibility of providing for their children, especially single-income families, so it’s important to consider what the impact of not working might be on your family.
Another misunderstanding is that young singles or couples with no dependents can forgo income protection. Couples may be able to rely on each other if one gets injured or sick. Also, finances may be comfortable with a steady job and sometimes there might even be savings to fall back on, but this may not always be the case. It can even be more important for those who are self-employed or owners of a small business to consider income protection.
Finally, some people also believe life insurance is all you need. While unexpected death is something we should all plan for, an unforeseen debilitating situation that can stop you from earning a living is equally important to consider.
What does income protection actually do?
If you’re under 65, Income protection could provide up to 85% of your monthly income, up to a maximum of $10,000 for a nominated period of time. It could help you keep your household running, help provide for your loved ones while you recover, and allow you to focus on what matters most.