Income Protection

How would you finance your lifestyle if you were unable to work for an extended period of time due to illness? Income protection pays out a regular cash payment that replaces part of your lost income if you have a medium to long term illness or disability and cannot work.
 
As your income is probably your most valuable asset, it is important that this is protected just as you would protect any other of your assets. To qualify for Income Protection you must be in full time paid work or be self employed.

You should consider income protection if you:

  • are self employed and have no alternative sources of income.
  • have little or no sick pay from your employer.
  • have dependants who rely on your income.
  • have no other source of income or money.

Did you know?

  • The current social welfare disability benefit is €10,286 for an individual rising to €19,610 for a family of two adults and two children.
  • Self employed people are not entitled to any disability benefit.
  • Income protection only covers illness or disability. It does not provide protection against redundancy.
  • Premiums are tax deductible at your marginal rate of tax.

Frequently Asked Questions

  • Will I have to do a medical examination?

    This depends on your age and the level of cover you require. Generally speaking the younger you are the less cover you require means no medical exam will be necessary.

  • I used to be a smoker, but I haven’t smoked now for three years. Should I review my policies?

    Absolutely! Smoker rates can be twice the price of non smoker rates, given the risks involved with smoking.  Even though you may be older, it is worth checking this out.

  • How much of my income can I insure?

    You can choose to protect up to 75% of your current earnings, excluding any other benefits you may have such as State Disability Benefits.  You will have to provide evidence of earnings such as [ayslips, P60s or a set of accounts for a self employed individual
     

  • My adviser mentioned something about a deferred period when making a claim, what is this?

    You can choose when you would like your payment to start in the event of a claim.  This is called the deferred period.  Esentially it means that you must be out of work for the duration of the chosen deferred period before submitting your claim.  The deferred periods on offer are usually 8 weeks, 13 weeks, 6 months and 1 year.  The longer the deferred period, the lower the premiums will be.  It is possible to have different amounts of income with different deferred periods, so you can claim earlier for some of your income and later for the remainder.  This can help reduce your overall costs.  Remember that all premiums are tax deductible at the rate of tax which you pay.

  • Will my premiums increase during the policy?

    If you choose the guaranteed premium option, your premium will not rise during the term of the policy.  Generally speaking guaranteed premiums are more expensive than reviewable premiums, because you are paying for the certainty of knowing what your premium will be.  Reviewable premiums are reviewed generally every five years.  This does not necessarily mean that they will rise, but it gives the insurer the 'right to raise' the premiums.  With either option, you can choose to index your benefits and premiums to stay in line with inflation so in real terms the value of your benefits remain the same, although in monetary terms they rise.

  • I work in mountain rescue, will I get cover?

    Insurers class different occupations into different classes when providing cover.  Class 1 tends to be office based personnel with no appreciable accident or health risk such as accountants or IT consultants.  Class 2 include people whose occupation may require them to travel for their work such as sales reps or quantity surveyors.  Class 3 is for skilled occupations which involve light manual duties, such as dentists or electrical engineers.  Class 4 includes skilled tradespersons working on construction sites and using light powered tools.  Teachers and nurses are also in class 4.  Occupations involving a significant amount of risk such as farmers and fishermen may have difficulty in obtaining cover.  To see what class your occupation is in, please contact us.

  • What is the diffference between 'own' and 'any' occupation?

    Some policies will only pay a claim if the indiviaual is unable to perform their own occupation or any other occupation which they may be suited to.  This can make it more difficult to be paid on a claim.  It's important when taking out Income Protection that you understand what you are paying for so be sure to ask your Financial Adviser what cover you have.  Taking out a policy which pays if you are unable to perform your own occupation offers you better cover and more security.