There are a variety of reasons why income protection is so important for people around the world. Here are some key reasons: Income protection can keep you afloat during tough times If you experience a drop in income or unexpected job loss, income protection can help you stay afloat financially. It can cover your mortgage or rent payments, utility bills, and other essential costs. This safety net can help you avoid falling into debt or losing your home. Income protection can help you focus on your health and recovery during tough times. It can remove the financial worry and stress that can come with a drop in income, job loss, or illness. This peace of mind can help you focus on getting better and getting back on your feet. Income protection can give you financial security during retirement Income protection can give you a safety net of income during retirement. If you experience a drop in income or unexpected medical bills, income protection can help you stay on track financially. This security can give you the peace of mind to enjoy your retirement years.
What about workers compensation or sick leave?
Income protection is different from workers compensation or sick leave. Workers compensation is designed to replace a portion of your income if you’re injured at work. Sick leave is designed to provide income replacement if you’re unable to work due to illness. Income protection is designed to replace a portion of your income if you’re unable to work due to injury or illness, no matter where or when it occurs. Sick leave is typically given to an employee and the legislated amount of sick leave is currently 10 days a year for full time employee. As a result, in order to receive sick for a substantial amount of time, you will need to have been with your employer for many years. Additionally, you may well use your sick leave for minor issues and ailments that occur through your regular working life and there is no guarantee that you will have sick leave when you need it most. Workers compensation will only cover you for incidents that occur at work and as a result, you will need to be injured at work in order to make a claim. This does not provide any financial protection for workers if they are injured or become ill outside of work. Income protection is different as it will cover you regardless of where your injury or illness occurs. This means that you are protected no matter what and ensures that you have a safety net of income if you are ever unable to work.
What is the impact of having both workers compensation and Income Protection?
You may be wondering whether you need both workers compensation and income protection. The answer is that it really depends on your individual circumstances. If you’re self-employed, then you may not be eligible for workers compensation but you may still want to consider income protection. If you have workers compensation, then you may still want to consider income protection as well given the significant benefits and flexibility an income protection policy provides. The bottom line is that income protection is designed to provide you with a safety net of income if you’re unable to work due to injury or illness. It’s important to consider your individual circumstances and decide whether income protection is right for you.
General Advice Disclaimer
General advice warning: The advice provided is general advice only and in preparing it we did not take into account your investment objectives, financial situation or particular needs. Before making an investment decision on the basis of this advice, you should consider how appropriate the advice is to your particular investment needs, and objectives. You should also consider the relevant Product Disclosure Statement before making any decision relating to a financial product.