Income insurance is designed to protect your income if you're unable to work due to an unforeseen health crisis. While you are disabled, these benefits are intended to substitute a portion of your weekly or monthly income so that you can continue to support your lifestyle and pay for everyday expenses. It's a smart way to protect yourself, your family, and your lifestyle. Without income insurance, workers and their dependents are at risk of losing their homes and investments. Not many of us will have enough savings to manage financially for long periods of illness – mainly if this money is reserved for things like retirement or helping children with their education.
That's where income insurance helps. There are a variety of products that can help to cover specific costs or replace income, should you find yourself unable to work.
The possibility of being unable to work due to a disability can be worrying to think about, but being prepared can help you to avoid financial stress in the worst-case scenarios.
Three core events can lead to severe financial suffering: death, disability, and old age. However, with good planning, there are specific solutions for each of these events. These solutions are Life Insurance, Retirement Funding, and Income Insurance. A truly comprehensive financial plan is not complete unless you have all three areas covered. Several studies have shown that most people have financial obligations that consume at least 60% to 70% of their monthly income – this is called the "disability shortfall problem."