Everything you need to know about income protection insurance
Income protection insurance is essentially a kind of insurance cover that will pay the policy holder a fixed income when they are not in a good condition to report to work owing to a serious disease or an injury which they sustained in a car accident or a work place accident or any other place. This kind of insurance policy helps the policy holder to enjoy their income even when they are not capable of fulfilling their work duties and responsibilities. Also, the income that the policy cover pays them is tax-free.
Two types of income protection insurance
Income protection insurance Australia policy is essentially of two kinds. There are short term policies as well as long-term repayment cover. The long term income protection cover involves the period during which the employer discontinues to pay the policy holder sick pay and when the policy holder starts to receive his/her pension. On the other hand, the short term income protection cover is designed to safeguard the policy holder's mortgages, bank loan as well as all other payment types. The duration of a short term policy ranges between 1 to 2 years.
What are the benefits realized from income protection insurance?
When you buy an income protection insurance Australia policy, there are several benefits to be realized from the policy. The first and the most important benefit of this insurance cover is premium release. This benefit can either get included as a constituent of the insurance policy or provided to the policy holder at an additional fee. Through this benefit, the policy holder will still be required to pay the insurance premiums which are usually on a monthly basis even when he/she is unable to report to work. With the premium release, the policy holder will be paid insurance premium for the number of days that he/she remained injured or sick.
The second most important benefit availed by income protection insurance Australia is rehabilitation benefit. This is unique to other benefits since it consists of helping the policy holder who remains sick to gain good health or start retraining them and assisting them to get a better or a new job.
Monthly income protection cover does not pay the policy holder till he/she is out of job for nearly 1 or 2 months. Thus, the individual will be required to opt for a better or a comprehensive plan that will pay him/her after 6 months have crossed.
Two types of income protection insurance
Income protection insurance Australia policy is essentially of two kinds. There are short term policies as well as long-term repayment cover. The long term income protection cover involves the period during which the employer discontinues to pay the policy holder sick pay and when the policy holder starts to receive his/her pension. On the other hand, the short term income protection cover is designed to safeguard the policy holder's mortgages, bank loan as well as all other payment types. The duration of a short term policy ranges between 1 to 2 years.
What are the benefits realized from income protection insurance?
When you buy an income protection insurance Australia policy, there are several benefits to be realized from the policy. The first and the most important benefit of this insurance cover is premium release. This benefit can either get included as a constituent of the insurance policy or provided to the policy holder at an additional fee. Through this benefit, the policy holder will still be required to pay the insurance premiums which are usually on a monthly basis even when he/she is unable to report to work. With the premium release, the policy holder will be paid insurance premium for the number of days that he/she remained injured or sick.
The second most important benefit availed by income protection insurance Australia is rehabilitation benefit. This is unique to other benefits since it consists of helping the policy holder who remains sick to gain good health or start retraining them and assisting them to get a better or a new job.
Monthly income protection cover does not pay the policy holder till he/she is out of job for nearly 1 or 2 months. Thus, the individual will be required to opt for a better or a comprehensive plan that will pay him/her after 6 months have crossed.
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