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The Value of Income Protection

29 Nov 2017

Though it might seem self-explanatory by the name, not everyone is necessarily clear on the details of what income protection means and the nitty-gritty of what it can provide. Situations fluctuate and what you, personally, are entitled to might not be very clear. As with the other blogs in our The Value Of… series, we hope to shed some light on the technicalities of income protection.

What is income protection?

If a serious illness or injury prevents you from working, income protection can help ensure that you don’t go without. Modern medicine and technologies means that people are more likely than ever to survive a severe health condition,however this also means that more and more employees are having to take time off of work for treatments and recovery.

This is an obvious concern and an added stress for anyone in this situation. With income protection, there is no need to worry if you will lose your income entirely. Your family, loved ones and personal home life don’t need to suffer. Income protection can help pay for your bills and sustain your current lifestyle.

Paying up to 75% of your usual income, income protection is an excellent back-up plan to have in place to make sure your standard of living remains mostly untouched.

Like with any other financial plan or insurance, there are a few key considerations to make:

What should you keep in mind?

  • There’s a chance you might already be entitled to income protection via your workplace. Check your employment contract or with your personnel department to see what is in place.
  • What other illness insurance you might already have in place and whether this is combined with another insurance policy or with your mortgage covering you for serious illness.
  • Whether you wish to rely on savings instead of insurance. It is highly recommended to use insurance instead – savings  might be quickly used up during a period of ill health, particularly if there are any future emergencies.
  • Medical history – similar to other insurance plans, a pre-existing medical condition can affect the price of your cover. You will be asked to provide full details of you and your family’s medical history – make sure to include correct and relevant information.

Like with any insurance plan, there are a number of factors that will affect the cost of income protection:

  • Your age – prices may fluctuate depending on your age when applying. Typically the younger you are, the less you’ll pay.
  • Lifestyle and hobbies – smoking, drinking heavily and drug use will increase the cost of your cover.
  • Your occupation –  a risky job (working with hazardous materials, dangerous locations etc.) will result in an increased cost.
  • The time before a claim – the longer you wait before making a claim, the cheaper your premiums will be.

Working out the level of cover you need

Not sure how to work out the level of cover you need?  Make a note of the following:

  1. How much your current income and what pay you currently take home.
  2. Calculate what and which state benefits you should receive and take away that amount.
  3. Take into account any expenses including food, clothing and travel – take those away.
  4. Add on extra expenses for illness and/or disability, from medical equipment, care, heating and appliance costs.

If you’re still unsure or have any questions about income protection, what you could be entitled to or how to apply, feel free to contact Full Circle Financial Services Limited. We aim to select a plan that provides you with the best possible cover at the best possible price. You’ll be guided through all the logistics and ensure that you know exactly what income protection you could be covered by.

More details can also be found on our products and services page.


Full Circle Financial Services Limited is regulated by the Central Bank of Ireland – C130136