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October 23 2012


An Unemployed Person Can Benefit From Income Protection Insurance

To be out of work is tough these days. There will be no month-to-month salaries to cover the bills or any necessities at home. Income protection insurance will be of help by paying a policyholder a fixed amount of cash either every week or monthly if they are unable to work due to illness or accidents. This is also acknowledged as salary continuance coverage. This could pay up to 75% of the annualwage of the policyholder. The payment usually occurs 30 days after the insured person is unable to go to work. The client will continue to get until he or she resumes work or till he get to the retirement age of 65.

This kind of bond will provide financial protection that will be helpful in the event of unforeseen circumstances like unemployment because of illness or injuries. The payments that are given month-to-month or weekly are free of income tax. When the insured person still pays for the premiums, he cant be refused or be cancelled to renew a policy. A waiver of premium could be offfered in which the policy premiums are not necessary when the client is paying for the benefits and the policy cover is normal as it is. Benefits such as for death, cosmetic or other surgeries and transplants are provided free of charge by the IPI.

An individual may receive an amount between 50% and 75% of their gross salary through income protection salary. This is often purchased to cover specific cost such as loans and other basic expenditures. It can be provided for a set term of a year and two years and may go higher as five to ten years. Payments which are known as earnings is considered to be able to know how much will be needed for the insurance.

Variety of factors can affect the cost of a coverage and may vary from insurer to insurer. The duration of coverage, the replacement earnings cost, the waiting period before the payment starts and other options are some of the elements. The client’s age, gender, occupation, health background and the retirement age could be some of the elements that may modify the cost.

There are deductions for other kinds of payments which are paid out with an IPI. It might include sick pay or salaries compensated by the employer and the earnings from self employment and pension payments.

Know very well what your insurance covers. Have a talk with your financial planners regarding your coverage for they will understand how much you're covered. IPI like any other insurance policy have limitations and ommissions that are not covered. Being pregnant and having a baby , and self- inflicted injury and war are example of this exclusions.

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