Salary Insurance

Certain things in life need to be catered even when you are not well or is disposed like child’s education, his/her marriage or providing financial securities to your near and dear ones. For this you will require to invest in a product that will give you a guaranteed income in the time of need and this is where salary insurance comes into being. Income protection insurance or salary insurance is a monthly benefit plan which pays you when you are out of salary due to some illness, injury or trauma. The payment through the insurance can be up to 75% of the income and is provided to you until you are fit enough to get back to work. In case you are not able to go back to work the insurance policy pays you till the age of 65 or in other words till you retirement age. Income protection insurance is tax deductible and is so designed that you can pay off your monthly bills and feed your family and tide over any financial crunch.

Why do we need income protection?

A research says that some of the employers around 12% cover for their employee in case of sick leave and that too for a year.  Thus everyone who is working or is of working age should opt for income protection. However, the same report says that only 9% of the working class has some or the other form of income protection when compared to 41% of them having life insurance and 16% of them have private medical insurance. One of the survey stated that only one-fourth of the working people considered income protection as necessary. However, income protection is a very essential to save you from the financial worries in case you do not go for work due to any medical reason. The insurance covers for your income till you gets back to work or until you retire or till your death, whichever comes first.

Is Income protection insurance and PPI same?

PPI or payment protection insurance are not the same thing. PPI covers for a specific debt and the money goes directly to the lender whereas in case of income protection the insurance company covers for your tax free income and gives it to you for your personal expenses. It is same as salary or you may say a replacement for the salary in case you cannot go to work due to illness or some injury.