Do I Need Income Protection ?

I have developed this guide to provide you with some Information to help determine whether you should obtain income protection.

I have attempted to make this analysis simple and to the point, so that you can make an informed choice. It covers some important issues and answers questions such as:

 why do I need Income Protection Insurance?
 doesn't Worker's Compensation cover me?
 will I ever be able to claim?
 how much cover is enough?
 what if I am overseas or have to leave work?



What Is Income Protection?

Most people have heard about it, many don't understand exactly how it works and few have adequate cover in place, if any at all!

So what is it?

It is a highly effective way of helping safeguard a person from the single greatest threat they may ever face - sickness or injury. If sickness or injury renders you unable to work, (and you satisfy the terms and conditions of your policy), then your income protection will go to work for you to pay a monthly income. Quite simply, it will help put food on the table, petrol in the tank, stop the bank from foreclosing on your mortgage, keep school fees paid and generally give you the means to maintain a reasonable standard of living if you are not able to earn your income.

Why do I need it?

When you consider how vulnerable a person's lifestyle is to a loss of income, it may be quite a risk not having your income protected.

Consider how much you earn, multiply that by how many years you have until retirement, and then add a factor for inflation and pay increases. It doesn't take a mathematician to work out that some people may be risking literally hundreds of thousands, if not millions of dollars if they were to suffer a long term medical condition without some form of protection.

To put it in perspective, try this quick quiz:

Which is your greatest asset?

Car
Home
Income

Which do you have Insured?

Car
Home
Income

What if I just continue taking my chances?

Recent statistics show that on an average day in Australia:

 214 people are diagnosed with cancer [1]
 41 people undergo coronary artery bypass surgery [1]
 35 people between the age of 35 and 69 will survive a heart attack [1]
 Further, more than 60% of Australians will be disabled for more than one month during their working life [2]
 more than 25% will be disabled for more than three months during their working life [2]

But won't my sick leave cover it?

Many people feel that income protection is only for the self employed and that their sick leave will protect them if they are off work. The truth is that even the most generous employer may be unable to maintain a salary for someone who is not able to work for an extended period.



Article Source: http://EzineArticles.com/7210250