So you’ve determined that you should get income insurance as a security measure in case you were unable to earn an income for a period of time. How do you go about doing it? If you feel overwhelmed, there’s no need to worry. With some careful planning and research, you can get the perfect income protection insurance plan for your needs and be able to sleep soundly knowing that should anything happen to you, your livelihood and that of your family’s will be protected.

An income insurance benefit will pay you income monthly if you are ill or injured until you are able to return to work or until your benefit period comes to an end.

Why would someone need income protection? If you fall ill or are injured, you may not be able to work. If you’re not able to work, where would you get the money to pay your rent or mortgage and pay for food? How would you put petrol in your car and pay off all your other financial obligations? If you have a family, you have even more expenses to account for. Unless you have substantial savings in case a rainy day comes along, you will likely need income protection insurance.

Income insurance in Australia can pay you up to 75% of the income you were earning before you were unable to work. Common benefits periods for income insurance are 2 years, 5 years, or until the individual turns 65 years of age.

How much premium will you have to pay for income protection insurance? This will vary according to several factors. Your income will be an important factor. Your occupation, how long you want to be covered for and how much you want to be covered for with your income insurance will also determine how much you’ll pay each month. Your occupation matters because some jobs place you at additional risk of injury and/or illness than others: if you work in a dangerous job, you will likely have to pay a higher premium. As with other kinds of insurance, your age, gender, and health history will also be taken into account.

Be sure to do some research before you decide which income protection plan you will sign up for. It’s a good idea to ask friends, family, and colleagues whether they have income insurance, and if so, whether they’re happy with the service they’ve received thus far. Nothing is more reassuring than good or bad word-of-mouth from the people you trust most.

Once you’ve found an income protection insurance plan that you’re happy with, it’s good to read the policy in detail because all insurance plans have fine print. You need to know what it is you’re signing onto.

For instance, should you need to make use of your income protection, what percentage of your income you receive from income insurance, if any at all, will depend on other benefits you could receive. For example, some employers provide supplemental sick pay. If you are injured on the job, you may qualify for worker’s compensation. If you receive any of these sorts of payments, you would not get the full amount of income protection that you would otherwise be entitled to under your contract. Some income protection plans may even take income from investments into account.

Do the proper reading and have a good talk about income insurance with the ones you care about. You may find one day that it was well worth it.