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When should I get Income Protection Insurance?

Income protection insurance can provide critical income in the event that the unexpected occurs and you are unable to work due to accident, sickness or depending on your policy, unemployment / redundancy. This can make a big difference in helping you to conitue to financially support the people and things you care about in the short-term. But when should you consider buying an income protection policy?

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Income protection insurance is designed to provide financial support to individuals who are unable to work due to accident, illness, and depending on the cover provided by the individual policy, unemployment or redundancy. It can pay out a regular income, usually a percentage of your regulary salary, to help you to continue to meet any financial commitments you may have, such as supporting your family or paying household bills if you are unable to work.

Typically, income protection covers what are considered unexpected events that prevent you from being able to work. Because of this, an income protection policy is unlikely to provide cover if you have already been made aware of circumstances that may affect your current employment, such as an employer's plans to conduct a redundancy excercise.

Because of this, income protection insurance can be considered as an insurance agaianst the full financial impact of unexpected events affecting your ability to maintain your lifestyle and the lifestyles of those that rely on your income.

As a result of successful claim, an income protection policy can provide a monthly payment (known as the benefit) in the short-term to help bridge the financial gap between loss of income and recovery, or a new job.

In summary, it is important to consider taking out income protection insurance as soon as possible, and before any direct or indirect risk to your employment is knowm, to ensure you are elegible the maximum available cover as defined in the policy wording in the event that you need to make a claim. Income protection insurance can provide peace of mind and extra financial security if you are unable to work due to an accident, illness or depending on your policy, made redundant.

As with all types of insurance, it is recommednded that you read the policy wording for your chosen income protection policy prior to purchase to ensure it meets your needs and that you are familiar with the exclusions and conditions of cover before purchase.