What is your greatest asset?
Most people typically respond that their home or their investments are their greatest assets. However, your greatest asset is actually your ability to earn an income. Is 20 years of your current income greater than the value of your house?
Most of us rely on our income to pay the mortgage or rent; to keep our families and ourselves clothed and fed; and maintain a comfortable standard of living. So protecting your ability to earn an income should be a high priority. Yet, while many people insure homes and possessions, they often ignore protecting their income.
An income protection policy will pay a regular income if you are unable to work because of sickness or injury. Whether the disability is as serious as cancer or as minor as a broken arm, income protection provides a simple, cost-effective safety net.
Most policies will pay up to 75 per cent of your average monthly income, and will cover you against various conditions, which could disrupt your ability to earn an income.
Income protection is particularly important to the self-employed, who cannot rely on short-term sick leave from an employer.
Some factors that affect premiums are:
- Your age, if choose stepped premium cover (if you intend to hold the policy for a long time it is best to start it at a younger age with Level premium cover so that it does not increase with age)
- The waiting period from 14 days up to 2 years
- How long cover is for; cover is available up to age 65
The policy can be held inside or outside of super. If held inside of super, it is not affecting your immediate cash flow, but you are still providing protection for you and your family. Structuring your insurance is important and we are here to help you with expert advice.
When borrowing or you have existing debts, you should consider your insurance needs for you and your family.
If you would like more information, please Contact Us.