Income Protection Insurance
This form of insurance
may be the most financially necessary, as it provides
cover for your greatest asset - your ability to earn income.
Under income protection insurance,
up to 75% of the life insured's earned income may be insured.
The insurance provides an income stream in the event the
insured becomes totally or partially disabled. Benefits
are payable after the selected waiting period and are
payable for a predetermined period, known as the 'benefit
period' as long as the insured continues to be totally
or partially disabled.
Waiting periods vary between 14 and
720 days. The longer the waiting period the lower the
premium. Benefit periods range between 2 years to a lifetime.
The shorter the benefit period the lower the premium.
These premiums are generally tax deductible, since the
income while on claim will be included in assessable income.
Selecting waiting and benefit periods
depends on your current circumstances. For example if
you have accrued sick leave or other employment benefits.
We use needs analysis to advise clients
which company's policy and selection of benefits will
most suit their requirements. The premium cost largely
depends on the insurance company's policy definitions
along with the age of the insured, the benefit period
and waiting period selected, the level of income insured,
occupation risk, the additional benefits chosen and whether
stepped or level premiums are to be paid.
It is advisable to take advantage
of the level rather than the stepped premiums if you consider
keeping the policy in force for the long term. This avoids
significant price increases that usually occur after the
age of 40 years by averaging the cost over the life of
the policy. However, you need to be aware that you pay
more premiums initially than the stepped option which
is only an issue if you decide to cancel the policy.
Harlocks can quote from all leading
Life Insurance Companies. Our advice is based on the most
suitable policy for your needs, while allowing you flexibility
to choose a policy to accommodate your financial position.
When quoting we provide a full Statement of Advice (SoA)
which provides a comparison between companies, policies,
definitions and premium cost. This allows our clients
to make an informed decision based on our advice, while
ensuring that the policy best suits their needs.
For more information or a quote on
this product please contact