Imagine this scenario: You’re 35 years old, earning $75,000 per year, with a mortgage, car loan, and family to support. Suddenly, a serious illness or injury prevents you from working for six months, a year, or even permanently. How would you maintain your lifestyle and meet your financial obligations?
This is where income protection insurance becomes your financial lifeline.
What is Income Protection Insurance?
Income protection insurance provides you with a regular income (typically 75% of your pre-tax salary) if you become unable to work due to illness or injury. Unlike ACC, which only covers accidents, income protection covers both accidents and illnesses.
Why You Need Income Protection
The Statistics Are Sobering
- 1 in 4 people will be unable to work for 90 days or more before age 65
- The average claim lasts 2.5 years
- Most people have less than 3 months of expenses saved
Your Biggest Asset
Your ability to earn an income is likely your most valuable asset. For a 30-year-old earning $60,000 annually, their lifetime earning potential is approximately $2.4 million. Protecting this asset is crucial.
How Income Protection Works
Coverage Options
- Short-term: Covers you for up to 2 years
- Long-term: Can cover you until retirement age
- Stepped vs Level premiums: Choose between increasing premiums or fixed costs
Benefit Periods
- 2 years: Suitable for short-term protection
- 5 years: Good middle ground
- To age 65: Maximum protection for your working life
Getting the Right Cover
The key is finding the right balance between coverage and affordability. Our experienced advisors can help you navigate the options and find a policy that fits your needs and budget.
Contact Cornerstone Insurance:
- Phone: +64 211 280 727
- Email: amy.tao@cornerstonefs.co.nz
- WeChat: Amytaoingrace