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Things You Must Know Before Purchasing Income Protection

Most people agree that income protection insurance is very beneficial since this type of insurance plans ensures that Australian residents do not have to worry about money when they cannot work for a short period due to sickness or injury. Listed below are a few things all buyers should be aware about before purchasing income protection insurance.

•    Insurance protection plans are suitable for both men and women. These plans are ideal for people who have children or family members to support. While everyone can benefit from this type of insurance plan, people who earn more than $20,000 annually benefit the most by opting for the right plan. Usually people above the age of 35 years opt for income protection plans especially if they have been diagnosed with a medical condition.

•    While insurance companies allow buyers to insure up to 75% of their income and in some cases an additional 8%, some insurance companies put restrictions on the insured amount based on the buyer’s profile. Insurance companies usually allow buyers to decide if they want to opt for stepped or levelled premiums.

•    Buyers have the option to choose between cheaper plans and better plans. Insurance companies offer both basic plans and comprehensive plans, cheaper plans have certain limitations while comprehensive plans offer additional benefits. For instance, comprehensive or better plans not only ensure that buyers get monthly payments after filing a successful claim, but also that people can enjoy other perks such as a day one claim benefit, death benefit and surgery benefits. Better plans that cost a little more usually offer a shorter waiting or cooling off period. A shorter waiting period is beneficial for people who want to enjoy the benefits of the selected plan as soon as possible. Since better plans are customizable buyers are also given the option to choose between agreed value contracts or indemnity contracts.

•    Buyers are often advised to ask a few insurance companies for quotes before purchasing income protection insurance since by getting multiple quotes and comparing these quotes, buyers can get the best plan for their budget. Insurance broker websites offer quotes online and they also allow buyers to compare these quotes in just a few minutes. Buyers who are interested in getting all the required details in one place and buying insurance from an authorized broker should consider opting for a reputed online insurance broker.

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Income protection is a crucial part of any comprehensive financial plan. If you’d like some help customising the correct policy for you, or want to know more about the income protection insurance benefits.