The Definition of Income Protection Insurance income protection insurance is also referred to as disability income insurance, or just disability insurance. It is an individually purchased insurance policy that pays benefits when you are too sick or injured to work and earn income Basics Disability income insurance helps protect a portion of your income and provides a fundamental layer of security for your financial future, according to MassMutual. You can obtain benefits up to a certain percentage, often 60 percent, of your regular monthly income. Purpose Income protection is intended for regular workers who rely on consistent monthly income to make mortgage, car loan, utilities and other monthly payments. If you do not have disability benefits through your employer, a private policy is your best option to protect yourself from extended periods of unpaid injury or sickness. Considerations Though they do not cover your entire monthly earnings, income protection benefits are generally non-taxed. This makes the take home pay gap with a full-benefit income protection plan much smaller. Find policies that are designed to cover injuries or illnesses common to your industry and profession.
Posted on: Mon, 04 Nov 2013 13:57:04 +0000
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