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· 18 Nov 2022

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A Compact Guide To Income Protection Insurance

Income protection insurance, Parramatta, is an insurance policy that pays benefits to the policyholders who are debilitated and hence cannot work due to an accident or an illness. It was formerly known as permanent health insurance.

The income protection insurance will pay part of your lost income when you cannot work. Your bills can be covered so you can focus on getting better.

What does Income Protection Insurance Parramatta cover?

When you are not able to work, the insurance will pay the following things-

1- It will pay 90% of pre-tax income in the first six months.

2- After six months, up to 70% of a specified time.

This policy is planned and designed to replace your income depending on your annual earnings before your injury or disability. Before a claim is made, every policy has its definition of total or partial disability.

Should you opt for Income protection insurance Parramatta?

You can obtain the policy for yourself if you are-

1- Someone who owns a small business or is self-employed. As you might not have the option of sick leave.

2- If you are the sole earner and have a family that depends or relies on your income.

3- Or if you have a mortgage or debt to pay. You would have to make payments even if you are not fit to work.

The first step to getting a policy for yourself is making a budget. This can help you understand your expenses and the amount you will need to replace them.

You should also consider getting the policy if you are someone who has a disability. The disability can be permanent or total. If you are someone who has private insurance, then consider getting this policy as well.

To wrap up

It is important to plan your finances well in advance for a good future. Make sure that you keep the above information in mind and get a policy that fits you best.

If you are looking for help deciding if you need an income insurance policy, you can contact Wealth of Advice.