Income Protection
What is Income Protection Insurance and how does it work?
Income Protection Insurance provides you with regular monthly payments if you’re unable to work due to sickness or injury.
By maintaining regular household income, income protection allows you and your family to keep up with your expenses, even if you aren’t working. This eases the financial pressure, so you can focus on getting back on your feet. Payment amount and length of cover will depend on your circumstances.
What does Income Protection Insurance cover?
If you’re unable to work due to partial or total disability, income protection insurance pays up to 70% of your pre-disability income.
Income protection insurance is designed to replace your income based on your annual earnings in the 12 months prior to your illness or injury. Each income protection policy has its own definition of partial or total disability that must be met before a claim is made.
Why do I need Income Protection Insurance?
Income protection insurance can be important if you:
- are either self-employed or a small business owner, where you may not have sick leave or annual leave.
- have debt that you need to make payments on even if you’re unable to work, such as a mortgage, loans etc.
- have family members or dependents that rely on the income you earn.
