When you are busy being mum, life admin can be the last thing you want to think about. However, no one should ever be too preoccupied to put the right provisions in place to protect their lifestyle, so don’t put off life insurance products any longer.
Chances are, you have taken out life insurance if you have a mortgage. It’s universally recommended to do so once you take on such a large financial responsibility. If you have a job or an income though, it’s a wonder income protection is not more widely promoted. It’s an essential for any working person, as it protects your income should you ever become too ill or injured to go to work.
Why take out income protection insurance?
If the COVID-19 pandemic has taught us anything, it’s that our health is never guaranteed and none of us are invincible. So, what would happen if you became seriously ill or accidentally injured and could no longer go to work long-term?
With an income protection policy, you are able to make a claim and if successful, receive a regular portion of your salary (usually between 30-70% depending on what you chose when taking out your cover) to keep life ticking over as normal when everything feels like it’s been turned upside down.
You can use this tax-free regular money however you choose. You might use it to pay your mortgage, rent and/or bills each month. Perhaps you need to purchase specialist healthcare equipment or make adjustments to your home. You would possibly be at home much more than before and so spending more money on food, heating, internet and entertainment services such as Netflix.
As a parent, a lot of your money usually goes towards kids packed lunches, school trips, weekend outings to the cinema. With a successful income protection claim, these things don’t need to suffer when life takes a turn and your children can continue living life as normally as possible.
Your income protection would continue to pay out until either one of these eventualities, whichever comes first; you recover and return to work, you reach state pension age and retire, the policy terms ends or you pass away.
Is income protection expensive?
As with many insurance policies, you will probably be able to find an income protection policy that suits your budget. The prices vary as your premiums are calculated with the following in mind:
- Your age
- Whether you smoke
- Your lifestyle and whether you have any high-risk hobbies such as extreme sports
- Your job
- Your health (current health, body mass index and family medical history)
- The deferral period that you decide on
- The income you’d like to receive each month
You might think that the younger you are, the less reason there is to take out income protection. However, if it’s cheaper premiums that you are after, it makes more financial sense to take this insurance out young. Insurers will see you as less of a risk, and therefore charge you less per month for your policy.
Think about it – are you more likely to pass away before you retire, or become seriously ill or injured? Life expectancies are higher than ever and whilst this gives us more treasured time here on earth with our loved ones, it also means we are more at risk of developing health issues.
Protect the life you love and take out income protection insurance. Your salary has got to be worth those extra pennies outgoing each month.