In the very simplest terms, Income Protection is a type of protection policy designed to protect your income. It provides an alternative income if you are unable to work due to injury or illness. This can give you financial security and peace of mind while you recover.
We all have mortgage protection, car insurance, home insurance, and travel insurance, to name but a few. But what pays for all these things? Your income. So why would you not consider protecting it?
Your income is your greatest asset.
Without your income the bills wouldn’t be paid, the mortgage wouldn’t be paid, and your car wouldn’t be there. And there would be no luxuries like gym memberships or holidays. Without it, your lifestyle would be financially impacted.
Here’s a little video that explains how income protection works.
It can be so easy to take your income for granted. But think of what would happen if an illness or injury left you unable to work. Do you have a plan in place to provide an alternative source of income?
- How long would you receive payment from your employer?
- Do you have savings you could use to sustain your lifestyle?
- What ways can you reduce your outgoings?
- Will there be any additional bills that you will need to take care of?
- Is there family you can ask for help?
An income protection plan pays you a replacement income. This payment continues until you return to work or until your chosen retirement date if you’re not fit to return to work before then. Many of the products available not only offer financial support but also a range of rehabilitation and career change programmes designed to help you get back on your feet. It really is a way of protecting your quality of life.