Income Protection Insurance protects you from lost wages if you become ill or disabled and are unable to work. It is important to know the key features, benefits and costs of the policies that you are going to take out.
Income Protection Insurance policies generally include protection on such things as credit cards, loans, mortgage payments and in some cases even complete loss of income. When you take out a policy you will have the ability to choose how much coverage you would like to receive. The amount is usually capped off at 60% of your earnings. There are several reasons why this cap is in place. The main reasons that the cap is in place is because the benefits that are paid to you are not taxed. It is also considered that there must be some kind of incentive for you to return to work once you have become well or are in good health. If there were no limit to the amount that you could receive it could be said that potentially the payments could cover you until retirement.
It is important to consider the definition of “unable to work.” Typically this is considered to be; your inability to do the job that is typically done, your inability to do a job that is similar and being unable to do any type of paid work.
An Income Protection Policy can be taken out for several reasons. Two of those reasons include an illness or disability that has rendered you unable to work. There are however conditions in which you may not be able to collect payment from this type of policy. They include; pre-existing conditions or any illness that you had prior to being issued the insurance policy. This is because the provider assumes a risk will be incurred. You may not be covered if you participate in dangerous sports which are not included in the policy or that are part of the agreement that is made between you and the provider. All forms of substance abuse including alcohol and drug abuse will not be covered under such a policy. Other things that are not covered under the policy include child birth, pregnancy and self-inflicted injuries. Make sure to check with your provider to see what types of illnesses or disabilities are considered under the policy. The best policies will provide insurance for a job that is “normally” done. These generally cost more but provide better benefits. You may also find that “partial or “rehabilitation” payments are offered if you are only able to return to work on a part time basis.
When looking for a Comprehensive Income Protection quote you must look at several things. This type of quote will include all of the benefits and payment options available to you. First, you need to be aware that these payments are monthly and in some cases will pay up to 75% of your current salary depending on total or partial disability. Having the security of knowing that you have protection and payments when you are unable to work because of an illness or disability and are going to be getting payments to supplement your income provides a relief of the stress that inevitably comes with this type of circumstance. When getting a quote look for the best rates with the best benefits. Ask your provider questions about the waiting period, the benefits period and optional extras. The waiting period is the time between becoming ill or disabled and being able to collect payments. You will typically be able to select between 14 days and 2 years. Keep in mind that a shorter waiting period generally means higher payments. When looking at benefit periods you will be looking at how long you will be receiving your benefits. More than likely you will be choosing between 2 and 5 years or up to age 65. A third thing that must be considered and understood is any optional benefits or extras that could be added to your policy. These could include; recurring disability benefits, benefits for transplants and cosmetic surgeries, payments for specified injuries and death benefits. Other benefits may include coverage from day one and coverage for business expenses. Look for low rates when finding a quote for this type of insurance. The amount of protection that you require depends on several factors. You should consider the potential for injury or disability and any other factors that you may consider to be possibilities as you age. Your circumstances may change but having these benefits in place will save you a great deal of stress and hassle if the time arises and you are unable to work. Because the premiums for this type of insurance vary from one provider to the next you will need to get a specific quote that includes your age, sex and type of benefits you would like to receive. For example, if you are a 40 year old woman earning $28,544.00 annually your quote may be for a payment of benefits totaling $1,600.00. The greater your income the greater the payments will be. Look for free quotes online from various services. Make sure that you check with different sources before deciding on one specific provider. It is important not o settle on one provider until you have found the quote that works for you. Keep in mind that the quote may vary slightly from the actual cost of the package because of conditions such as overall health, age and sex along with others that may not be specified when you are locating the quote.
When comparing income protection quotes there are several companies that are at the top of the list that you should consider first. Two of the top Income Protection Insurance providers include; Prudential and GISecure. Below are two quotes from these two companies and what they cover in their benefits along with any limitations or exclusions.
Prudential: A woman age 31 who makes $28,000 a year can expect to pay $53.95 per month. She will receive up to $2,500.00 per month either until the age specified in the policy contract or she reaches 65. You will be eligible for a policy under this provider if several conditions are met. These conditions include; being 18 years of age or older but not to accede 60 years, you must also be paying the correct class of National Insurance Contributions for a consecutive 6 month period prior to the start of her policy. There is a 30 day waiting period between application and collection of benefits. Once the policy takes effect she will receive payments once a month until the max benefits or paid or until the end of the plan schedule. There are several things that are not covered under a policy taken by Prudential. These things include; voluntary unemployment, being aware of unemployment at the start of the policy, being employed by a Limited Liability Partnership where the director or owner is a direct relative or any other stipulations that are set prior to acceptance of the benefit package. You can find out more about specific quotes for this company as well as the following company at www.topquoteonline.co.uk.
GISecure: A woman age 31 who makes $28,000 a year can expect to pay $56.90 per month. She will receive up to $1,000.00 a month in benefits or 50% of her income, whichever is less. There are three waiting period options for this provider. They are; 30 days after the policy is issued with payment starting on the 31st day, 30 day waiting period with benefits starting on the 61st day or a 60 day waiting period with benefits beginning on the 91st day. Some exclusions that are included in this policy include; pre-existing conditions or those that you have had prior to becoming insured, a medical condition that has been diagnosed 12 months prior to the start of the policy and is being treated up to 24 months after the policy is taken out, backache or related condition unless a radiological scan determines that there is an abnormality that must be addressed or conditions related to stress unless diagnosed by a psychiatrist. This company does not offer joint application on their policies. As with the first example more information and specific quotes can be gathered at topquoteonline.co.uk.
There are many unforeseen things that happen in our lives. One of these conditions includes unemployment due to illness or disability. Having the option of purchasing Income Protection Insurance takes the burden off of you. You will have the peace of mind that you will have coverage and supplemented income while you are unable to work. There are many companies and providers that offer quotes and it is important to do your research to find the best quote for you. Be aware of any limitations or exemptions in the provider’s policies. Ask questions and make sure that you fully understand the policy before making any final decisions. Having this type of insurance and being aware of what it offers is a great financial preparation.
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