Protect your greatest asset… your earning potential

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A4blA lot of people are under the misconception that their property, investment portfolio or vehicles are their greatest assets.

During Women’s Month we invite all the ladies reading this article to consider the effect that losing your income would have on your household. Whatever the cause – a hysterectomy, childbirth or pregnancy complications, a serious illness – income protection could save you and your family from financial ruin.

The fact is that, if you’re in the prime of your career or still have working years ahead of you, your potential to work and earn an income is your greatest asset – an asset worth preserving and protecting, much like the other assets you own.

Most of us are confident in the knowledge that our properties, vehicles, jewellery and other assets are protected by short-term insurance. In the event of theft, fire, damage, etc. we submit a claim and replace our loss. However, very few of us adequately insure our earning potential.

Income Protection is the ideal way to replace your income in the event of a temporary or permanent disablement or sickness. If you are unable to work due to an accident or illness your income protection will replace your loss of income. Statistics show that 70% of those covered by income protection will experience at least one temporary disability in their working lives.

An advantage of income protection is that it includes partial income replacement cover. So if you’re unable to work the hours stipulated in your employment contract, this cover will pay you the shortfall. For example, if you’re recovering and only able to work four instead of eight hours, and your employer is paying you for four hours only, income protection will pay you the difference so that you receive a full income.

One of our preferred service providers, FMI, has provided us with examples of income protection claims it paid during 2013:

FPM

Income protection covers you for illness claims as well as accident claims. FMI has provided us with a breakdown of causes of illness claims:

fpm1

By paying a premium based on the amount of cover you require, you can insure your income and have peace of mind. The contributions are non-deductible, which means the proceeds of the policy will be paid to you tax-free.

During Women’s Month do you and your family a service by talking to us about the correct income protection cover. The premiums are minimal in comparison to your comfort and peace of mind.

GemmaGemma De Luca
Paraplanner & Fiduciary
gemma@fpm.co.za
0861 111 376

This article is a general information sheet and should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your financial adviser for specific and detailed advice.

SRA
SRA