Insurance FIRST

Income Protection

This benefit protects a clients greatest asset - their power to earn. It provides for a monthly payment to be made to an individual who is unable to work due to sickness or injury. It is essential for anyone with a partner or a family dependent on the insured's income for the maintenance of their lifestye.

What would you do if a serious illness or accident stopped you from working ?

How long would you stay financially stable if you were unable to work, and who would this affect?

Would your partner be able to compensate for your lost income by working more, or entering the workforce?

The Facts are:

Around 1 in 6 of the working age population has a disability.

Of those with a disability, 10% within the working age population are disease or illness related and 38% are attributed to accident or injury. 1.


	The Facts are: 5 in 10 males are likely to become disabled due to an illness or accident before they turn 65, preventing them from working for at least a month. 2. 1 in 9 men will be disabled and off work for more than 12 months before age 65. 2.


	The Facts are: 7 in 10 females are likely to become disabled due to an illness or accident before they turn 65, preventing them from working for at least a month. Of these, nearly a third will still be on claim 12 months later. 2. 1 in 5 women will be disabled and off work for more than 12 months before age 65. 2.

Source:

1. Statistics New Zealand, Disability Counts 2001

2. Davies Financial and Actuarial Limited
3. Insurance Alert, Winter 2000

Options avaiable from some insurers:

	Indemnity Value Provides a benefit up 75% of your earnings prior to disablement. The 75% option pays a sum that is designed to be taxed. The premiums for the 75% option are intended to be tax deductible, while the 55% premiums are not.
	Rehabilitation A lump sum of up to six times the monthly benefit is available to pay for approved specialised equipment or home alterations.

	Agreed Value Provides a benefit up to 55% of your earnings prior to disablement. The 55% option pays a sum that is not designed to be taxed. The premiums for the 55% option are not designed to be tax deductable.
	Bed Confinement If you are confined to bed during the waiting period, at home or in a hospital, and under daily supervision of a registered medical practitioner, you may be eligible for a benefit payment

Choice of Benefit Period

Most insurers offer benefit payment period of 1, 2 or 5 o or five years, or to
age 65 or 70

Back to work payment

If you return to work between 12 and 24 months after claiming, you can receive a lump-sum payment equal to three times your monthly benefit claim amount.

Vocational Retraining

Provides funding for re-training programmes to help get you back to work.

How it can help:
	FUTURE FINANCIAL SECURITY The financial impact of a disability or extended illness could be devastating for your lifestyle and those that depend on you. Prolonged absence from work or a return to work in a reduced capacity could have a severe impact on your future financial security.

	INCOME DEPENDANCY How dependent on your income are you and those around you ? Do you have any other sources of income other than your job ? Who would support you if you couldn’t work and what impact would that have? Is anyone else dependent on your income?