Working individuals often worry themselves over financial obligations and the possible loss of their job and income. With the slump that the American economy is in, it is no wonder that income protection insurance has become so prevalent in recent years.
As a working individual, your income is by far your most important and valuable asset. Without your income, you would not be able to have a house, utilities and maybe even a car! Your income is a constant cash flow that builds the foundation of your future including your dreams. You don’t want to lose all of your income on auto insurance. With that being said, consider what you would do if you were to lose your income – maybe because of injury or illness. Those dreams and most of the things within your future that you have planned would not be achievable.
For most of us, the loss of income would be financially devastating. Our lifestyle would be impacted, but more than that, the foreclosure on our Oakland real estate, repossession of our vehicle(s) and more – possibly even bankruptcy – could be in our future.
You Can Protect Your Income!
Believe it or not, just like you can purchase health, dental and life insurance, you can also purchase protection insurance for your income! Sure, it may sound absurd to many, but to everyone else, it could ultimately be a lifesaver!
Income protection insurance is a very cost-effective way to help protect you as well as your family from the financial hardships that you could face in the future should the loss of income occur. As a general rule, income protection insurance will pay three-quarters (75 percent) of your regular income during the time that injury or illness has you unable to work. This type of insurance will allow you to continue making payments on your vehicle(s), your home, medical expenses, utility bills and pay for other living expenses.
Factors Used When Determining Income Protection Premiums
As with any form of insurance, income protection insurance comes with certain factors that companies use to establish your insurance premium. Here are a few of the deciding factors:
- Your Job – If you have a dangerous job, then you can rest assured that your premium for income protection will indeed be higher.
- Waiting Period – When you obtain an insurance protection policy, in the clause will be a stated waiting period. This waiting period is how long it will take for your insurance to take effect (being paying out) after your injury or illness.
- Age – To be put bluntly, your premiums will be higher the older that you are. The reason for this is obvious – the elderly, senior citizens, or individuals that are older are more at risk for developing a severe illness. With that being said, purchase at a younger age for a prolonged period of time – your premiums will be cheaper and you’ll be covered for a decent term.
By taking out income protection insurance, you are indeed planning for and protecting your future as well as your entire family’s future. This insurance will help you avoid severe financial stress and will keep you from getting in major debt.
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