You insure your house, you look after your super, but do you safeguard your biggest asset of all \u2013 your income? That\u2019s where income protection cover comes in. Here\u2019s how to make sure your policy gives you the security you\u2019re looking for.<\/p>\n
\n
Income Protection gives you a regular income if you can\u2019t work due to accident or illness, this replaces part of your regular income giving you financial support for as long as it takes to get back on your feet.<\/p>\n
\n
Affordability:<\/p>\n
\n
Income protection can be cost-effective!! This is because your premiums are generally tax deductible if you hold your policy outside of your super \u2013 making it more affordable to get the cover you need.<\/p>\n
\n
Do you need Income Protection insurance?<\/p>\n
\n
You may want to consider Income Protection insurance if you:<\/p>\n
\n
\u2022have a partner, family or dependents
\n\u2022have a mortgage or any other personal debt
\n\u2022have a business or self-employed
\n\u2022would need money to live if you were unable to work
\n\u2022don\u2019t have adequate savings to cover unexpected expenses.<\/p>\n
\n
How much you\u2019re covered for<\/p>\n
\n
Most income protection policies let you choose your sum insured \u2013 usually up to 70% of your salary before tax (excluding super contributions). But remember, the higher the sum insured, the more you\u2019ll pay in premiums, so it\u2019s important to think about how much you\u2019ll really need.<\/p>\n
\n
To work out the right level of cover for you, start by considering all your everyday expenses. This might include things like rent or mortgage repayments, bills, groceries and school fees. You can also consider your occasional costs like your car registration and insurance. You should discuss this with your financial adviser.<\/p>\n
\n
Income Protection changes now in effect
\nAs of 1 October 2021, income protection policies with generous features and benefits were taken off the market. APRA required insurers to change disability definitions, re-look income assessments and cap monthly benefits at 70%.<\/p>\n
\n
On 31 March 2020, new applications for Agreed Value income protection insurance were discontinued.<\/p>\n
\n
All income protection insurance policies available today provide an indemnity type of cover. This means if you make a successful claim the monthly benefit you\u2019ll receive is based on your income at the time of claim.<\/p>\n
\n
How long you\u2019ll receive a benefit for
\nYour benefit period is the maximum amount of time you can receive payments from any claim. It varies depending on the income protection policy you have. When you take out cover, you can either choose a time period or the longest available benefit period, which is to the policy anniversary when you\u2019re 65.<\/p>\n
\n
Benefits of Taking Insurance Through a Financial Adviser
\nA financial adviser can help you understand your current financial situation, as well as your goals for the future, so you get the right cover for your needs. They can structure your cover in a way that gives you the best value for money and suits your cash flow and tax objectives.<\/p>\n","protected":false},"excerpt":{"rendered":"
You insure your house, you look after your super, but do you safeguard your biggest asset of all \u2013 your income? That\u2019s where income protection cover comes in. Here\u2019s how to make sure your policy gives you the security you\u2019re looking for. Income Protection gives you a regular income if you can\u2019t work due to […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[],"class_list":["post-3002","post","type-post","status-publish","format-standard","hentry"],"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/riskwisdomfp.com.au\/index.php?rest_route=\/wp\/v2\/posts\/3002","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/riskwisdomfp.com.au\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/riskwisdomfp.com.au\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/riskwisdomfp.com.au\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/riskwisdomfp.com.au\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=3002"}],"version-history":[{"count":7,"href":"https:\/\/riskwisdomfp.com.au\/index.php?rest_route=\/wp\/v2\/posts\/3002\/revisions"}],"predecessor-version":[{"id":3010,"href":"https:\/\/riskwisdomfp.com.au\/index.php?rest_route=\/wp\/v2\/posts\/3002\/revisions\/3010"}],"wp:attachment":[{"href":"https:\/\/riskwisdomfp.com.au\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=3002"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/riskwisdomfp.com.au\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=3002"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/riskwisdomfp.com.au\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=3002"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}