What is Income Protection?

Income protection is a form of insurance that basically pays you an income if you cannot work for some reason such as accident of illness. This kind of income protection cover will often pay up to 75% of your income for a certain period of your choosing. It could be for two or three years or until you retire, depending on what you choose.

If you are close to retiring age, it would make sense to choose that option, because it takes a great deal longer for an older person to recover properly from an injury or illness. Many people think of their house and car as their assets, but it is actually their ability to work and earn an income that is their biggest asset. Losing this means the loss of your other assets if you haven’t finished paying for them.

We often think that accidents or illness only happen to other people, but statistics show that the majority of people will suffer an accident of some kind or a debilitating illness at some time throughout their lifetime. This is not all bad news. In many cases complete recovery is possible.

But this recovery process will be facilitated if you do not have to worry about where the next meal is coming from, or how on earth you are going to pay the mortgage and other bills. Income protection in Australia is becoming more popular as people see the need to protect their lifestyle and other assets so they are not lost forever. In fact, income insurance is actually an asset in itself and should be seen as an investment rather than a cost.

Cheap income protection can be found by researching and comparing offers made by insurance companies. There are various forms of income protection so those who are interested in this form of insurance should check out all the details carefully to make sure they get the one that is most suitable.

Income insurance premiums differ depending on your occupation, health, age, and several other criteria such as the level of protection you choose. Payments from income insurance are not usually taxable.