- 23 May, 2014

The Importance of Life and Income Protection Insurance

Insurance ensures that when an unexpected event occurs in your life then you are able to protect your financial security. This, in turn, guarantees that your livelihood and you and your family’s lifestyle remain the same, regardless of circumstances. While you can’t prevent accidents, illness, injury or death, you can reduce the impact of such incidents by having income protection and life insurance.

Why do I need life and income protection insurance?

It is estimated that 1 in 5 families will either lose a parent to death or that a parent will suffer from a serious illness or accident that will prevent them from working. With some 95% of Australian families not having adequate levels of life and income protection insurance, it is estimated that a typical Australian family will lose approximately 50 percent of their income if an incident does occur. Whereas if a family has adequate insurance then they’ll protect their income.

What does life and income protection insurance cover?

If you take out adequate life and income protection insurance it should cover your debts such as your mortgage repayments, car loan repayments, credit card debt, your bills and cost of living expenses. Insurance should be enough to cover all of these expenses without you or your family having to alter or change your lifestyle.

What types of insurance are on offer?

The most common types of insurance that you’ll encounter are as follows:

  • Term Life Insurance – This is a life insurance policy that pays you and your family a lump sum to cover any expenses, should you be diagnosed with a terminal illness. It also covers your life should you pass away. Most policies exist until you are aged 60. After this time, premiums become more expensive as your life expectancy decreases.
  • Income Protection – This policy covers your existing level of income so if you become injured or sick your policy covers your bills.
  • Total and Permanent Disability – This is usually a lump sum payment that helps you to meet your financial obligations if you can no longer work due to illness or injury.

Life and income protection insurance, in most cases, is affordable and gives you peace-of-mind. Premiums can be deducted from your nominated account on a weekly, fortnightly or monthly basis and the application process is straight-forward and typically takes approximately 20 minutes to organise.

Interested in knowing more about life or income protection insurance? If you said YES, then talk to one of oureChoice consultants and find the right cover for YOU.


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