OK, I know. You work hard to just to make some decent money and take care of your family. You save part of what you earn to pay for your kids’ college. You pay your bills in due time and takes your loved ones on vacation every year. But what would to you and your family if all of a sudden you had a serious accident? There are many answers to that question, but, as right as some may seem, there’s only one that really solves the problem:Income Protection Insurance(IPI).
Let’s suppose you suddenly got ill or hurt, in a way that would make it impossible for you to work. Wouldn’t it impact your (and your family’s) lifestyle? Maybe not at first, I admit. You’d have that money you’ve been saving. You’d just have to postpone your personal projects and dreams a little while longer, and starts saving once you get better. If it takes too long, you just start cutting expenses here and there. You sure can survive a few months without cable TV. And maybe your wife can come to enjoy the pleasures of life without a credit card. But what if it takes too long for you to get better? You know money takes long to save, but takes no time to be spent. Soon, your savings account will start to look terrifyingly empty. Then your kids will start to ride the school bus. Maybe they’ll have to transfer to a public school. You can also drive a cheaper car, or just take a bus. But there’s also the perspective of never getting better at all. And what will you do when you open your fridge and notice there’s almost no food in there? Getting worried won’t feed your kids. In moments like that, having an IPI could make all the difference in the world!
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Income Protection Insurance protects the worker from falling in the “zero income” limbo. The insurance companies actually pay up to 70% of the policyholder’s salary during the time he stays incapacitated. It means you’d still have to live without cable, but your wife would keep her credit card. And you’d better believe me when I say you will not want to try the opposite.
It’s always good to read your policy carefully when acquiring an IPI. Every policy specifies in detail what kind of injuries and diseases are covered, and some of the texts might be a little tricky. And you certainly don’t want to lose your benefit because of a minor technicality. You should also keep in mind that no insurance company in the world would pay a benefit if your incapacity resulted from fighting in a war, committing a crime, intentionally hurting yourself or consuming alcohol or drugs. Women should be extra careful, since most of the policies won’t cover anything related to pregnancy.
Inflation might also turn into a problem, a few years after contracting an IPI. Benefits tend to be eroded with time, and you should make sure the value of your benefit gets corrected periodically. Otherwise, you may find yourself receiving a lot less than you expected.
Some companies pay for their workers’ IPI, but if that’s not your case, syndicates and associations can also contract group policies for their members. Group policies are a good option, since the cost/benefit relation is a lot more attractive than those of individual policies.
Some IPI policies expire with time. Always remember to renew your policy, if that’s the case. It would be awful to find out your policy expired a week before you got in that little car accident.
If you’re willing to pay for an IPI, know the best benefit you will ever receive is the certainty that your family will be alright for as long as you live. Now, if you want them to be OK even after God invites you to his 5 O’clock tea in Heaven, you should also consider Life Insurance. But it’s something we’ll have to talk about one other day.
Finance Blogs are providing real informations about Income Protection Insurance. ArifsBlog is one of the best Finance Blog, in helping its readers to provide the massive informations about finance.