Income Protection Insurance Australia, Secure Your Future – Breaking News

You may be happy with having a good steady job now, and people who depend on you financially. But have you ever thought, about what would happen if you later have to leave due to specific sickness? To prepare for the worst, you may need income protection insurance Australia. Why is that?

Overview of Income Protection Insurance Australia

What is income protection insurance Australia? Among the various types of insurance, it may never have crossed your mind to have income protection insurance. 

Even though this insurance is actually no less important than health insurance and life insurance. This insurance will protect your salary when you can no longer work. 

In one condition, for example, when you are sick or disabled, then you cannot work anymore to make money. That’s where the role of income protection insurance begins.

An income protection insurance company will replace your income regularly when you are unable to work or have retired. This money paid comes from the premium fee that you pay every month. As a result, you may still receive an income even when you are unable to work.

Australia is a country with a good system and raises a lot of insurance for a better life for its citizens. One of them is by providing income protection insurance. This insurance is an important thing for the society to have.

Moreover, this is also important for those of you who have other family members who also depend on your financial income.

What Does it Cover?

Income protection insurance is able to cover costs with a fairly broad estimate. The income protection company will provide 90% of your salary every month, for the first 6 months you cannot work. Then, it will pay 70% of your salary every month after the first 6 months.

This income protection insurance in Australia has a system designed to replace your passive income for the next 12 months when you are sick. That way, you don’t have to worry about how you and your family will live for some time to come.

Who Needs Income Protection Insurance in Australia?

In some situations, you may need income protection insurance if you are self-employed. That’s because an entrepreneur will not have annual leave, which still has passive income, gets sick benefits, and others. Thus, your income only comes from your current job, and there are family members who depend on your income.

In addition, if you have debt that must be paid for the long term, then this income protection will help you. On the other hand, your medical history can also be considered. Those who have a poor medical history, or have hereditary diseases, tend to choose to buy health insurance and income protection insurance.

Income Protection Insurance Australia Policy

Before deciding whether to buy an income protection insurance policy or not, you also need to understand how the system works. This insurer offers a number of insurance plans with two policy systems, as described below.

1. Compensation Value

The amount of money paid, or able to claim for Income protection in Australia depends on the percentage of your salary. This means that the amount of money you can get depends on your income in the last 12 months.

If you have experienced a decrease in your monthly salary since buying an insurance policy, the money you get from the insurance will also decrease. For example, you buy a policy in January, then a year later, your salary has decreased.

If you get a specific disease the following year, you will receive passive income from insurance which also decreases according to last year’s income.

In other cases, if your monthly salary rises and falls quite varied, then the percentage of insurance payments will be taken from the average income per year.

2. Approved Value

The second policy system is the value of money that follows the amount that has been mutually agreed upon, at the beginning of purchasing the policy. If you choose to buy an income protection insurance policy Australia, follow this policy. Then you will choose a nominal percentage of money that you will pay each month.

So when you get sick later, you will receive money worth the deal at the beginning. This policy system tends to have a value that is more expensive than the value of compensation. However, it will be much more comfortable if you have an income with consistent salary increases every year.

Zurich Australia offers an Ezicover Income Protection plan with a special offer, free of charge for the first month. You can buy a policy for as little as $12,000 per month and with a general tax deductible.

Things You Should Notice About Income Protection Insurance

Apart from these things, you also have to pay attention to other important things. Buying an insurance policy for income protection also cannot be claimed right away. There are a number of other requirements that are no less important for you to pay attention to, especially if you live in Australia.

1. Waiting Time

When you just bought an insurance policy for income protection, and a few days later you get sick, you can’t immediately claim income payments just like that. You must follow the waiting period in order to make an insurance claim.

Each company may have different policies regarding this waiting period. However, the average company provides a waiting period of 14 days to 2 years. If you turn out to be sick at the end of the waiting period, then you can process the insurance claim.

2. Benefit Period

How long the benefit period you buy will make the policy price higher. This benefit period is a time series that determines how long you can get that income support.

For example, you cannot work for two years or more. So, it would be better if you have income protection insurance Australia within the same timeframe. In general, a company will provide a policy offer, which has a coverage period of up to 2 to 5 years. 

The Future is in Your Hand

Income protection insurance feels similar to life insurance, it’s just that there are two different long-term needs. You can determine your future, by choosing which insurance is best for you. Because buying an insurance policy, paying a premium every month is a form of your business in making future investments.