Income Protection: A Case Study
Written By: Jak Johnston
Income protection is one of those things that no one wants to pay for but feel they should have, ‘just in case’. However, often the thought of paying this additional expense overcomes that niggling feeling of precaution. Here is a case study to show you why it is important to listen to that little voice and invest in income protection for a rainy day, just in case.
Brien is a 27 year old physiotherapist who is married with two kids; he has a gross earning of $120,000 a year and expenses of $60,000. His expenses are mainly fixed with mortgage repayments and a car lease, the rest of his earnings go towards school fees, entertainment and general living, as his wife does not currently work and stays home to look after the kids. Brien has a fall while riding his bike on the weekend and breaks his collarbone and wrist and is unable to work for 8 weeks, requiring surgery and rehabilitation; he also did not have any insurance taken out to cover him for being out of work. What insurance cover could Brien have taken out to protect his income and family from unforeseen events such as this?
Income protection is designed to assist you if you’re unable to work due to sickness and/or injury and covers up to 75% of your monthly income. In Brien’s case, it would have enabled him to pay his bills and cover other expenses whilst he was unable to work.
It doesn’t take much to have an accident which takes you out of work for an extended period of time. It could be as simple as tripping on a gutter; as much as we like to think we are invincible, the truth is we are not. So don’t be Brien. Get yourself organised and protect yourself and your family in case something happens. Future you will be very grateful.
Contact us if you would like some guidance on the best income protection for you.