+ What is Income Protection?

Income Protection has a range of options, and the key to choosing the right one is to get the right advice, and to understand how your policy works for you.

In a nutshell, if you can’t work due to illness, injury, and (in some cases) redundancy, Income Protection is designed to pay a weekly, fortnightly or monthly sum insured, like an income. Your cover starts after the nominated stand-down period and continues for a set period of time.

There are a lot of factors to consider when it comes to Income Protection... So, rather than read a novel on it, why not contact us to have a chat about it!

What do I need to think about?

• Lifestyle – How would your lifestyle change if you were unable to earn an income? Would you be checking into Auckland Airport, going away on that fancy holiday? Or what would your Instagram posts look like..... Income protection can help you maintain your current lifestyle.

• Budget – Working out how much you’d need to live on is key to making sure you have the right level of cover. What do you spend each week? Would you be able to go without a few luxuries? Make sure you insure for a comfortable standard of living but don’t forget that tightening your belt a little will reduce your premium payments.

• Leave provisions and savings – If you are in paid employment, what are your leave entitlements? Have you accumulated a whole lot of sick leave that carries over every year? Do you have annual leave that you aren’t planning to use for a vacation? Would you want to dig into your savings to help pay the bills?

• Family – Consider how the loss of your income may affect your family, i.e. how important is your income? Can your spouse’s income support the family alone?

There’s a myriad of options available with Income Protection insurance, so it’s probably the most important product to get expert advice on.

Because of what it can cover, it is often more expensive than other kinds of insurance, so careful planning is important to choose the right cover for you.

+ How can I claim?

1. YOU CAN CLAIM ON ANYTHING.

This means there are no specific illnesses or conditions that you claim o. It's designed so you can claim when you meet the definitions of the policy, i.e. Wait Period, Benefit Period and specific terms given to you after your application for cover is assessed by the insurer, and these are listed on your policy schedule.

However, there are some things you need to know when it comes to IP claims, and trust me, they're better talked about in person! It's extremely important to understand when you can claim and when you can't. Things like injury vs. illness (ACC), working hours per week (there are limits) and your GP or Specialist recommendations, all have an impact when it comes to claim time.

It's important to know as much as you can so you know what you're getting.

2. YOU CAN CLAIM MULTIPLE TIMES.

We all know that it's fantastic when some things happen more than once... not everything though!

IP pays out a monthly sum, as apposed to a one off lump sum, like Life or Trauma Insurance. This means that it'll keep paying you, like an income, monthly or fortnightly, until you are fit and ready to go back to work, or when your benefit period expires. If you have existing insurance, refer to your policy schedule and policy documents for details on how this applies to you.

The cover remains in place for as long as you have an active policy, meaning that you could claim on it multiple times, so long as you maintain the premium commitment. Even for a condition that keeps reoccurring.

3. HIGH CLAIMS RATE.

Because there are a lot of claims for IP, insurers are being forced to increase premium to keep up with the demand for support. This in itself shows you that the possibilities of claim are much higher than you might think.

The best way to ensure that you are not paying a huge premium, is to understand how your own provisions can work alongside the levers within IP, and there are handful of options available to you.

You need to get something that works for your situation. Don't buy something online without proper advice as you might not be purchasing what you think you are.

As insurance premiums rise, we will be able to assist you with options to bring the premium down and keep it affordable during our annual reviews.

You want to make sure that you are adequately protected during the years that your income is crucial to you and your families wellbeing.

4. WHAT ELSE...?

There is more to tell you... and it'll be easiest done in person or over the phone. But if you want to do some more reading, you can expand the next link for more information.