Income Protection

Income Protection insurance aims to minimise the financial impact of sickness or injury by replacing income lost during a prolonged absence from work. A monthly benefit will assist you to meet living expenses and debt repayments.

Income Protection policies will usually pay a benefit up to 70% of your gross income (some policies may pay higher) after a waiting period. Payments continue for a set term or until you return to work, whichever occurs first. Waiting periods range from 14 days to two years. Generally, the longer the waiting period, the lower the cost of the income protection insurance. Benefit periods range from two years, five years or until a specified age.

The monthly benefit paid may differ to the monthly benefit insured as it will depend on your earnings at the time of a claim. The monthly benefit received is based on your gross income at the time of claim. Details of proof of income will be required at the time of claim.

You can generally claim a tax deduction for most premiums paid on an income protection policy (other that any portion of the premium that is attributable to benefits of a capital nature such as physical injury or critical illness). However, income payments received are considered taxable income.