Income protection insurance is one of the most important inclusions in any family’s financial planning. Put simply, income protection is a guard against the unknown future that could see one or both parents left without the ability to work and therefore earn a wage to support their lifestyle and family obligations.
One of the most common uses for income protection insurance coverage is the protection of children’s needs. A child is expensive—this is true for those living in Australia as well as anywhere else in the world. In the United States, the USDA estimates that a single child will cost more than $233,000 to raise from birth to the age of seventeen. That’s not including any college expenses or financial support beyond that seventeenth birthday.
As a disability insurance option, income protection operates as an insurer against surgery, slips and falls, and other catastrophes that can leave you without the ability to work for an extended period of time—perhaps even years.
Income protection offers a guard against the unknown.
As an insurance product, income protection is a fascinating addition to anyone’s insurance portfolio. Coupled with life insurance and other coverage options, you can rest assured that no matter what life might through your way, your family will be protected in the event of a tragedy. In this regard, income protection is an important addition. Life insurance, for instance, only provides a payout to your family in the event of your death. This means that if you’re left unable to work, but still very much alive, your family will be forced to struggle on without the benefit of the life insurance’s payout.
In an odd twist of fate here, life insurance policies will only pay if you are up to date on the policy’s premiums, meaning that if you can’t work but don’t have this cash flow coverage, you may lose the benefit that your family will be counting on in the event that you don’t pull through after a car accident or other major incident. While no one wants to think about their own demise, protecting your family against the unknown means gaming out these morbid scenarios in order to ensure that they will be taken care of, no matter what might happen in the future.
Income protection is often a very affordable addition to your current policy protections.
The good news is that income protection and other disability insurance coverage options are often very affordable for those looking to add this additional layer on to their life insurance coverage. Bridging the income protection gap is crucial for securing your family’s financial security, and yet it’s often the component that’s overlooked in these family planning discussions.
Providing for your family’s financial security is important during these times of hardship. By protecting your loved ones in this way, it takes an additional burden off of their shoulders during the lean times. Money is often a significant factor in the stress and grief that is felt after an injury, accident, or death in the family. Yet this doesn’t have to play a role in these troubled times.
Taking this additional pressure off of your loved ones is a great way to help them cope with the new reality that they are facing after a potential injury or accident that may leave you out of work for many months or years.
Adding income protection insurance to cover injury, sickness, or freak accidents is a crucial step in the family planning process. Building these contingencies into your plan is the only way to ensure that your loved ones will be cared for, no matter what.