Income Protection Insurance is a type of insurance that helps you to replace your income if you are unable to work due to illness or injury. You may be able to claim on your policy if you suffer from any illness, injury or condition that prevents you from working and earning money. This includes mental health conditions and physical disabilities (such as back pain) which can make it difficult for some people to work. Income protection cover can be important for those who may not have enough savings set aside should they become ill or injured, and it can help provide financial stability during times when they need it most.
But what exactly is income protection insurance? How much cover do I need? And how much will my monthly premium cost? All these questions answered here…
What is income protection insurance?
Income protection insurance is a type of life insurance that provides a regular income to replace your income if you are unable to work due to illness or injury. It’s not a long-term solution, but rather a short-term solution for those who need financial support while recovering from an illness or injury.
Income protection insurance is suitable for people who are:
- Self employed and earn their main source of income through their business (e.g., farmers)
- Employees who earn commission only or variable bonus payments such as salespeople or some IT professionals
How much income protection cover should you get?
The amount of income protection cover you need is dependent on your circumstances.
For example, if you’re self-employed and have a family to support, then it’s likely that the amount of income protection insurance available for purchase will be higher than for someone who works for an employer and does not have dependents. This is because there is more chance that your business could fail or suffer financial difficulties which would result in reduced income levels.
The amount of cover you choose will also depend on how much money can be afforded each month by both parties involved in the policy purchase agreement (i.e., both employer and employee).
Who needs income protection insurance?
- Anyone who earns a salary.
- Anyone who has dependants.
- Anyone who is self-employed.
- Someone with a pension, including public sector workers and those in the private sector who have a defined benefit scheme (DB).
What are the common conditions covered by income protection policies in Ireland?
A common condition is illness, which includes any illness or condition that prevents you from working. Examples of illnesses include:
- Cancer
- HIV/AIDS
- Heart attack or stroke
Injury is another common condition that income protection policies cover. This can be something like a broken bone or back injury that prevents you from working for a period of time. Some policies will also cover accidents at work and their resulting injuries, though this may vary depending on your specific policy and provider.
What are the different types of policy?
There are three main types of income protection policies: term, critical illness and group.
- Term – This is the most basic form of income protection policy; it provides a regular payment if you are unable to work due to illness or injury. The amount paid out depends on how long you’ve been paying into the policy and whether your employer pays for some or all of it (if so, this will be shown on your certificate).
- Critical Illness – This is similar to term insurance but covers different illnesses such as heart attacks or strokes rather than accidents or injuries like broken bones. It also pays out more money than a standard term plan would because it covers more conditions (and therefore more likely ones).
- Group Policies – These are offered by employers as part of an employee benefits package; they generally provide higher payouts than independent ones do but may have waiting periods before any payments begin
How much will a monthly premium cost me?
The cost of your monthly premiums will vary depending on a number of factors, including your age and gender. For example, younger people are likely to pay higher premiums than older ones because they are at greater risk for illnesses and injuries. Similarly, men will generally pay more than women due to their higher likelihood of developing certain health conditions like heart disease or cancer–and these conditions can also affect their ability to work in the future if they’re not properly covered by an income protection plan.
If you have pre-existing medical conditions when applying for life insurance or other types of insurance policies (such as car and home insurance), then this information may be used against you when determining how much money should be paid out upon making a claim on your policy later down the road. However, with income protection insurance there’s no need for any pre-existing medical information since the only thing being covered here is lost wages caused by sickness or injury rather than actual medical bills incurred during treatment itself!
Income Protection Insurance can protect you against the financial impact of illness or injury preventing you from working
Income Protection Insurance is a type of insurance that protects your income if you are unable to work due to illness or injury.
Income Protection Insurance can be used as a stand-alone policy, or it can be purchased in conjunction with other types of protection such as Critical Illness, Mortgage Life and/or Death Cover. It’s important to note that the cost of these additional benefits will vary depending on how much cover you want and how old you are when taking out the policy.
Conclusion
Income protection insurance is a type of policy that will pay you a monthly income if you are unable to work due to illness or injury. It’s important to understand what type of cover is right for your needs and budget, as well as any conditions that might affect your ability to get an affordable quote.
