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Benefits of Income Protection Insurance Cover

January 23, 2012 | Comments: 0 | Views: 146

Income protection insurance cover is vital for any worker as it ensures he or she will continue to receive money in the unforeseen event of an illness or injury. Even if the employer provides sick pay, it is often for a limited time period and reduced amount to normal salary levels. The benefits to having income protection insurance cover are well worth considering.

Focus On Recovery

It is important to have peace of mind when recovering from an accident or illness. Many workers get more worked up from missing working hours and lost wages than from the physical pain they are undergoing. Income protection insurance cover gives them comfort in knowing their family is still provided for even if they are lying in a hospital bed. Paying those monthly premiums is easily worth that guarantee of financial security. Not working, even if it due to a legitimate reason is a source of anxiety and stress for many. It easier to rest and relax when one is sure they won't suffer loss of income.

Continued Financial Assistance

Having that regular payout is the same as having a regular salary. With income protection insurance cover, a worker can be assured of receiving an almost similar amount as what he or she was earning prior to becoming incapacitated. This means no loss of cash flow. Even without working, the policy cover ensures an income earning adult can still continue to receive income.

No Lapses In Meeting Financial Commitments

Every adult has certain financial obligations. Whether it's to shell out monthly rent or mortgage payments, pay the gas and electricity bill or even tuition fees for children, financial obligations are a part of life. Just because someone gets ill or is injured, does not mean such commitments can be suspended. This more than any other reason, is why it is important for a working adult to have income protection insurance cover. The only commitment a policy holder can skip here is payment of taxes. This is because the insurance payouts are tax-free. This also accounts for the 25-50% discounting on gross pay that is done before payouts are made.

Proper Financial Planning

In times of such emergencies such as accidents, many people are forced to dig in to their savings, borrow and selling off some investments so as come up with money that will help take care of their family's expenses. Without the regular cash flow wages bring in, people have to pull in resources from other directions. This can seriously derail any long term investments made and compromise your long term future. By having income protection insurance cover, you are able to continuing receiving payouts at a similar level as your regular wages and have your other investments remain intact. If you were in fact a saver who committed part of every salary to a savings account or investment, you can continue to do so when your payouts begin.

Many adults are not aware of the benefits of income protection insurance cover simply because they are not even aware that it exists. Part of the blame can be placed on insurers who do little to publicize the availability of this cover. More should be done to inform workers of the importance of such policies. An increase in the number of subscribers would probably also result in a reduction in the premium rates.

Find here the information about income protection and income protection cover.

Source: EzineArticles
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