Our wages directly influence our lifestyle, with our quality of life often closely tied to how much we earn. But what if one day that income disappears? Our lifestyle is impacted, and in many cases, becomes entirely unsustainable. Should you fall ill, or become injured, will you be able to sustain the lifestyle you lead? With Income Protection cover, the answer suddenly becomes a lot closer to yes. Income Protection is also of particular importance to business professionals, small business owners and self-employed people, as their ability to work is tied to not only their income, but also to the long-term health of their business.

There are a few things to consider when looking at taking out Income protection cover. Naturally, the first area to consider is the cover amount, with many providers allowing for up to 75% of your income to be secured. However, looking at your ongoing expenses and considering what you are prepared to compromise on means that you may be to live comfortably on a lower level of cover – meaning cheaper ongoing premiums.

The next area to think about is your benefit period. Some cover options allow for full coverage up to age 60 or 65, while others will only cover your income for a 2 year time period. While the former does offer the most security, it does also wind up as more expensive than a lower benefit period, so it’s a clever idea to look at your personal circumstance and family medical history to determine how long you should aim for.

Income protection Policies offer options for Stepped or Level covers. Typically, stepped cover starts out as cheaper than levelled, but the premiums are liable to change and increase with age, so it may end up as more costly later in life. Level cover on the other hand remains at a constant value, but will mostly be more expensive than stepped cover in the future.

Similarly, there is also the option to choose between Indemnity and Agreed values on your cover. The difference between the two comes into play at the time of claim – Indemnity cover pays based on your salary at the given time, whereas Agreed cover pays based on your salary at the time of application. This may lead to your cover paying for more, or less than you may have hoped, depending if your salary at time of claim is higher or lower than at time of application. As a result, Agreed cover is the “safer” option, but with potential raises or promotions taken into consideration, Indemnity cover may lead to a more accurate assessment of your income.

When lodging a claim on your IP cover, you will first need to ensure you have evidence to present as part of your claim - typically this will be provided by a doctor in cases of sickness or injury. You will also need to provide details on your working status, particularly leading up to your injury/illness. Following submission of your claim, you will then be lead through the process by your insurance provider (and later in the process, your claims representative), providing you with current details on your account, helping to ensure you have access to the right forms and information. Following this, you simply need to complete the required details, then your claim will be assessed by your insurer.