Remember when you completed that long run on the weekend and injured your back so badly you had to miss work the next week? Did you feel the repercussions of a smaller payslip that week? 

With Income Protection Insurance at Morgan Insurance Brokers, you don’t need to worry about catching that East Melbourne winter flu, dislocating that dodgy knee, or any other unforeseen circumstances that can occur in day-to-day life. 

So, how do you choose the right Income Protection Insurance for your needs? There are several factors to consider before you decide on the right Income Protection Insurance cover. 

What if I don’t need Income Protection Insurance?

It is estimated that around 29% of Australians have Income Protection Insurance, with tens of thousands of Australians finding themselves in the position to claim income protection insurance every year. You could be one of them. 

You may be hesitant to explore Insurance Protection further if you don’t think you will need it. We all want to believe that serious accidents won’t happen to us. However, Insurance Protection is much more than cover for the worst-case scenario. Some common claim examples include: 

• Severe Flu
• Mental Health Break
• Pregnancy Complications
• Broken Leg
• Back injury

These all sound common enough, right? 

You can identify the right Insurance cover for you and your needs; it doesn’t all look the same.

So, how different can Income Protection Insurance be?

Well, choosing your Income Protection Insurance begins with your occupation. Occupations with higher levels of physical risk (Construction workers and Emergency service workers) may face higher premiums as they are more likely to face work-related accidents. A lower-risk occupation may be entitled to cheaper Income Protection Insurance cover. If you’re an office worker accustomed to sitting behind a desk all day, you may find that your cover won’t cost you all that much. What price would you pay for a contingency plan?

Another factor to consider is your age. Lower premiums are usually expected with younger age groups. Age is used to determine the increase in premiums due to the correlation between age and the heightened risk of health issues, which may result in extended periods off from work.

Income Protection Insurance can also vary in the percentage of income covered. A higher cover will usually be 75%, although this will be more expensive than a lower cover of 60%. 

You can tailor how long you require payments from your Insurance Protection Insurance. If your cover is for a shorter period (e.g, 2-5 years), this may be significantly lower in cost than one that covers you through to retirement age. Do you plan to run a marathon next year, and you’re getting worried about the physical side effects and setbacks it may cause you in your workplace? You can opt for a shorter cover for a stress-free training period.

Finally, you’ll want to assess the waiting periods of your cover. This defines the time between when you find that you require your cover and when the benefit payments begin. For example, if you’re a casual worker who requires a larger safety net in the event of an unforeseen circumstance, you may want to consider a shorter waiting period so that you can ensure you’re covered quickly.

Consider Premium types

When considering your premium types for your Income Insurance Protection Cover, you will need to evaluate your financial circumstances, life plans, age, health, and generally what you feel will be most suitable and comfortable for your situation.

Stepped Premiums are generally lower in cost initially. They can increase over time, but are typically a safer option for young working professionals who want a contingency plan that won’t interfere with their budgets. 

Level Premiums are consistent and generally benefit more long-term decisions. Whilst higher in initial cost, they can become more cost-efficient if maintained over many years. If you are expecting a fixed income for the foreseeable future or have begun making retirement plans, a level premium may be more beneficial as it provides stable and predictable cover.

Not sure where to start?

You’re off to a good start. It is important to consider all your personal factors and assess which cover you may benefit from the most. Our professionals at Morgan Insurance Brokers can provide you with general advice and help you get started.

Don’t wait for a situation to happen tomorrow; get protected today. Contact us today for a quote.