Protecting your income has never been so important

Richard Lishman explains what you need to know about income protection.

Finance management has been more important than ever for many people of late. Whether your income was unaffected or you experienced a period with no money coming in at all, you will have almost certainly reviewed your financial situation in light of the pandemic. Protecting your livelihood wherever you can will have become a priority. Part of this will involve checking or strengthening your income protection.

Why it’s important
Income protection is a form of health insurance whereby you receive an income should you find yourself unable to work due to sickness, injury or accident. At a time when everyone’s health is at a higher risk than it once was – especially for those with underlying health conditions – this is even more important than ever before. Getting sufficient protection in place will provide invaluable peace of mind that your basic living expenses will be covered and your family kept safe in the event that you were unable to work for a prolonged period of time. In general, policies insure up to approximately 65 per cent of your gross salary or your net profit for self-employed associates, though monthly caps will likely apply. Any payments received are tax-free.