Income Protection Insurance: A Saviour In Trying Times
Life is uncertain and we are all aware of that
. Apart from taking life insurance policies, there are several other precautions that people take to protect themselves so that they can secure the future of their dependants. But, what happens incase a person becomes incapable of earning for a certain period of time due to an acute illness, a sudden accident or something of this kind?
This is where Income Protection Insurance comes as a ray of hope for the affected person and his family. This is a policy which is available in the United Kingdom, which gives benefits to these policyholders. It provides a security cover for the income earned by people, incase they are unable to work for a specified period due to an injury or illness. A person can get up to 75% benefit of his salary incase he is suffering from a problem and is covered under this policy. The sole purpose of opting for this kind of protection is to ensure that the policyholder can continue to meet the daily requirements of his family members and continue to pay his debts if any, till the time he is capable of resuming work. This policy holds good only for persons who are residents of the UK.
Every policy is taken because of the benefits derived by it. Here are some of the benefits that would be available to such policyholders. As soon as the person becomes incapacitated, the benefits will be payable to him either weekly or monthly, and these are not taxable. As long as the premium is paid, the policy continues to exist. Since these policies offer a large sum of money as a guarantee incase of a mishap, these policies are comparatively expensive.
Lets consider a few important tips while making a decision to own an income protection policy. The time for which the policy will remain active, the injuries and illnesses covered under the policy, the exclusions and conditions subjected to which compensation will be received, the existing and increase in premium, the waiting period between filing of claim and receiving the first payment and also, purchasing a policy which is index-linked, which helps to match up and cover the inflation rate.
Since the choices involved are many, and it is an important decision which involves the hard-earned money of the policyholder, it is essential to consult and get the advice from a financial advisor in order to select the right product meeting the requirements and conditions of the interested policyholder.
by: Kirthy Shetty
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