The mines are cutting jobs at the speed of light, while commodity prices continue to plummet. Both Europe and China are going through some seriously tough times and South Africa is starting to feel the overspill impact of this with the Rand hitting a 14 year low. Amidst all of this, giant corporations like Telkom are talking about three day work weeks if things don’t change soon (and experts are predicting that it won’t).

Scary right? Not knowing what the future holds for the economy and for your own pocket can be a daunting experience, particularly in times like these.

What can you do, you ask?

The simple answer is to save as much as possible. Savings can provide a great buffer should the unexpected happen.

But how much would you need to save to be comfortable your usual income?

Heaps! That’s why it is also a good and economical idea to get yourself some income protector cover as it is never a bad time to get one (and considering the massive instability in the economy and market, we’d say now is actually a pretty good time to get one). Together with your savings, an income protector policy will go a long way to giving you peace of mind, as well as some much needed relief should worst come to worst.

What do we mean by income protector insurance?

Income protector insurance pays out benefits to the policyholder should this person become incapacitated and can therefore no longer work to earn an income for themselves. In other words, if someone takes out income protection insurance and they suddenly fall so ill that they are unable to work (and earn a living) or they are declared unfit to work due to the occurrence of an accident, the income protection policy kicks in paying out a monthly benefit to help you bridge the financial gap and hopefully get back on your feet as fast.

How does an income protector work?

Income protector policies initially cover your monthly income by paying out as much as R55 000 per month in the event of you being unfit to work as a result of injury or disability. Today, these policies have evolved with some including retrenchment benefits as well and others paying out certain benefits in the event that you are forced to take unpaid leave to look after ill family members.

Is income protector insurance expensive?

It doesn’t have to be… Your monthly premium will be linked to two major things, namely:

1) The extent of the cover that you take out (obviously you will pay more monthly if you seek benefits of R50 000 per month as opposed to R10 000 per month)

2) your current record (this includes how healthy you currently are, how dangerous your job is as well as your lifestyle).

What is excluded?

While it is best to chat to your insurance provider about their specific terms and conditions, we can tell you that some income protector policies exclude:

  • Any injuries or disability arising as a result of a person’s mental illness
  • Any intentional self-inflicted injuries or disability
  • Any injury or disability arising as a result of participation in criminal activity
  • Any injury or disability arising as a result of being intoxicated
  • Conditions associated with normal healthy pregnancy

Whether you have been declared unfit as a result of injury, have become permanently disabled or cannot find a job in the tough market, having an income protector policy will come in handy to give you some stability and assistance during tough times.