What is Income Protection

Income Protection protects your income by providing you with a monthly benefit if you are unable to continue working. For example, if you were unable to work due to a serious accident or illness, either temporarily or permanently, income protection insurance could provide you with up to 75% of your pre-disability income to live on until you are able to return to work. Or if you were unable to return to work for the long term, an income protection benefit could continue to provide you with a replacement income for 2 or 5 years, or even to age 70.

Your Biggest Asset

 

If you are like most people, your income is your biggest asset and losing it could turn your life upside down and threaten your financial wellbeing. If you have major financial commitments such as a mortgage or a family, it is important to think about what might happen should you be unable to work for an extended amount of time – how long would you emergency savings last and what would happen after they ran out? Statistics show that 47% of working Kiwis aged between 18 and 64 could not survive longer than one month after using their sick and annual leave (http://mindthegap.co.nz/).

It is also prudent to remember that Government benefits are unlikely to cover your living and lifestyle expenses and that ACC only provides income cover if you are unable to work due to an accident. If you were faced with having to stop working due to an illness or degenerative condition, ACC would be of no use in this situation – could you survive with little to no access to Government assistance? If you do not have access to extensive savings it may be time to look at your income protection options and ensure your financial commitments are safeguarded. 

Benefits

Across insurance companies there are various names for income protection insurance benefits, some are referred to as mortgage and income protection, indemnity or agreed value income cover and all carry different maximums in cover levels. Essentially, all provide a replacement income in the event that something goes wrong but finding which product is best suited to you depends on factors such as whether to not you have a mortgage, if you are an employee or self-employed and even what bells and whistles you may prefer. However, the biggest factors that affect your income protection premiums are your occupation, the amount of time you can wait before your benefit kicks in (generally four, eight or thirteen weeks) and the amount of time you would like your benefit paid for if you are unable to work long term (usually two or five years or to age 65).

No matter what type of income protection benefit you select, it is important to seek professional advice as not all policies are created equal and you want to ensure that you understand what you are and are not covered for. This means you’ll still be able to meet your financial commitments and make choices that are important to you.

What is Income Protection Insurance

 

Hannah Lawrence
Hannah Lawrence
21:00 15 Mar 20
Hayley was very efficient and always delivered on her promises. She put together a good package for me. I would highly recommend Hayley.
Jay Nimbus
Jay Nimbus
08:11 15 Mar 20
Daniel was great to deal with and made seemingly complicated decisions a lot simpler than I expected. I had been stressing about it for a while, wish I had got in touch sooner. Much thanks!
CrazySmurf Azrial
CrazySmurf Azrial
11:20 28 Feb 20
Hayley was awesome to deal with, answered all my questions and followed up with me weekly to keep me informed throughout the whole process. It can be daunting but she made the process easy. She was easy to talk to and didn't feel pressured.Thanks Hayley for organising everything and helping me through the whole process.
Paul has helped me to find the best option for my family insurance. He made everything easy.
Trixie Lawton
Trixie Lawton
15:55 25 Dec 19
I found Hayley very pleasant to speak to and was explained everything in great detail and in easy terms
Kayleigh Price
Kayleigh Price
22:12 16 Dec 19
Paul was very easy to deal with and made income protection insurance seem much clearer. He gave sound advice, was efficient, friendly and I would recommend him to anyone.

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