Take Measures To Protect Your Income – Tips?

By Author: Shourya Ray Chaudhuri
Total Articles: 598
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Protect your earnings and make such a plan a tax free one. You can save your earnings and at the same time enjoy certain benefits. Think of a day when you are suddenly laid off and there is no one to financially support you. What will you do in such a situation? You may take some extreme steps and may want to end your life. Your family may be in penury if you have nothing as savings and you are out of job for long…do not lose hope. You need not be in such a grim situation if you are well protected with a sound insurance policy.

You are put back in a safe position as you have a protective shield against you and your earnings. This is known as income protection insurance. This allows you for a 50 to 75% of your monthly earnings and you are free from all worries. You ca fall sick and still not feel the brunt of being out of employment for long. Such is the solace provided by the income protection insurance to you.

This has certain exceptions such as it does not cover self employment. If you are self employed and are unable to go to work due to inability, illness, accident etc you will be paid by the insurance company. ...
... It only covers your monthly earnings if you are employed by some one else. It also does not cover you if you are on sick leave and are still getting some monthly earnings. You must consider what are the things that are included and what are those that are excluded? If you are aware of this, you will be in a better position to make your decision.

Salaried employees may have a reasonable amount of accrued sick leave through work in which case you may wish to set a longer waiting period to make the monthly premiums more affordable. It will also offer you peace of mind, knowing that you will still have an income that pays the mortgages and household bills, should you become laid off or be unable to continue working.

How would an Income Protection policy help me if you were unable to work due to illness?

The principal benefit of income protection insurance is to provide you with income if you are unable to work due to long-term sickness or injury. Unlike other protection policies, such as critical illness or term assurance that pay out lump sum benefits, income protection insurance is designed to provide you with a regular monthly income which continues until the first of these events:

• you recover and are no longer incapacitated

• you are no longer suffering a loss of earnings

• the policy ends

• you die

Income protection insurance aims to put you back to the position you were in before you were unable to work. It pays a regular tax- free monthly income.

Shourya Ray Chaudhuri, Ezine Articles Expert Author.For more information: Income Protection Insurance
Get more information: Redundancy Protection Insurance