Are you worried about losing your income? You may fear losing your job due to the recession. It is uncertain whether there would be a continuous flow of income. Due to inevitable reasons, your basic amenities may not be met. What do you do in order to prevent it? You get an insurance in place to protect your earnings. If you fall short on your mortgage repayments then you may have to make an agreement with the lender that you need an extension in payment dates and pay up a penalty for missing them out. But, when your income flow is disrupted it may be really difficult for you to catch up with your mortgage payments on a timely basis. It is highly impossible with out a reliable source.
Reach insurance experts to find out the income protection options that are open to you. Basically there are two types of protection of income: income payment protection and income protection insurance. These are two different terms although they sound similar. Ultimately, they try and help you safe guard your income. Read on to find out what is the difference between the two.
Income payment protection
Income protection insurance
Income payment protection – this pays for a temporary basis. It is paid for a short term. It usually lasts for 30 -90 days. It can stretch to 12 monthly payments. It ceases to exist once you find a job and are earning money again. It also helps to get tax exemption on your income.
And the income protection insurance can last longer till you get retired. This will not payout for unemployment but will pay your monthly payments when you are crippled or are unable to work due to an accident, chronic illness etc.
You might have to make a lot of adjustments in your life style, if you lose your job. As you have to pay back a lot of bills including your grocery bills, electric bills, credit card bills, mobile bills and the financial problem aggravates if you have a bigger mortgage commitments. It makes a lot of sense to have your income protection policies in place. With such policies, you will be able to make all your payments. Your insurance will compensate for the loss of income and will pay out till you resume back to work. It can even cover your medical expenses and hospital bills. Get the most suitable cover to protect your earnings.