Do I need Income Protection Insurance?

Your Income is your Most Valuable Asset

Your future ability to earn income typically far exceeds the value of any other physical or financial asset that you will ever own. You take steps to ensure you protect your home, car and other assets but many people neglect to protect their most valuable asset – their income.

Why do I need Income Protection Insurance?

The key question is whether you would be able to pay your mortgage and bills if you were sick or injured and could not work. Income Protection is insurance cover that provides you with replacement income if you are unable to work on a medium to long-term basis due to illness or injury.  The insurance provider pays the income after a pre-determined period chosen by you at outset which can range from 4 to 52 weeks.

How does Income Protection Insurance work?

An Income Protection policy pays you a monthly income if you are unable to work due to any illness, accident or injury. This helps to ensure you can continue to meet your monthly mortgage repayments and household bills and maintain your current standard of living. It will continue to pay you an income until you are well enough to return to work, or if not, until your retirement age.

Income Protection Insurance – A Quick Review

  • Up to 75% of your earnings can be covered.
  • Tax relief on premiums at is available at your marginal rate of tax.
  • Many employers don’t provide any form of sick pay and of those that do, many will only pay you for six months.
  • If you are self-employed you are not entitled to the State Illness Benefit if you are unable to work due to illness.
  • The cost of your cover will never increase during the term of your plan (unless you choose to index it or apply to increase your cover at a later stage).
  • Non-smokers benefit from cheaper premiums.

Harvest Financial have no ties to any banks or insurance companies; therefore we can review the market and all policies available to us to provide you with the best possible cover for the lowest cost available.

Find out More about Income Protection Insurance

For more information, or to arrange a meeting to discuss your income insurance requirements, please contact us on 01 2375500 or email us at justask@harvestfinancial.ie.

 

This marketing information has been provided for discussion purposes only. It is not advice and does not take into account the investment needs and objectives, financial position, risk attitude, liquidity needs, capital security needs and/or capacity for loss of any particular person. It should not be relied upon to make investment decisions.

IMPORTANT POINTS ABOUT INCOME INSURANCE

If you stop making your regular payments, you will no longer be protected, and we will not refund any money.

You cannot cash in your plan – it is not a savings plan.

It is very important that you re-evaluate your plan benefits against your current earnings, as they may not continue to meet your needs.

At the time of a claim, your earnings must be above the level that justifies the amount of cover you have chosen. If not, you will receive a reduced benefit. In this case, we will not refund any part of the payments you have made.

The particular tax treatment contained herein is based on Harvest Financial Services Limited’s understanding of current Revenue practice as at September 2018. Please note that the tax treatment depends on the individual circumstances of each client and may be subject to change in the future. You should take such independent tax advice as you deem appropriate.