Income protection insurance Your ability to earn an income is valuable and needs protection. Income protection/salary continuance cover can provide you with a financial safety net of up to 70% of your pre-disability income (definitions changed for new policies post October 2021) in the event that you are unable to work because of illness or injury. In some cases, income can include employer superannuation contributions.
It is designed to help secure your lifestyle by ensuring your cash flow needs and loan repayments are met should you suffer a temporary disability.
There are a number of drivers to consider when applying for cover including:
- Waiting and benefit periods. (14, 30, 60 , 90, 18-, 1 & 2 yrs) & (for 2,5 year to age 55, 60,65 or 70) – Do you have access to large accumulated leave?
- Is the benefit to extinguish debt, finance recovery, or to help modify your lifestyle?
- Do you have a current term life, total and temporary disablement or trauma policy?
- Would you be able to return to work in a full capacity?
- Do you have any dependants to provide for?
- Loss of salary for each day you are off work?
- Loss of employer superannuation?
- How much sick leave entitlements do you have available with your employer?
- Would your home/car require modification to ease your disability?
- The waiting period is determined by a number of factors, including your level of savings and accrued sick leave.
- The premium may be tax-deductible; however, your tax adviser would be able to confirm this.
NB: From 31 March 2020, Agreed Value Income Protection policies are no longer available – Policies issued after this date will have benefits calculated on an indemnity basis – contact us for details!