Two words get thrown around a lot – risk and insurance.
In some financial circles, The latter (insurance) has been touted to be somewhat an ‘antidote’ to the former (risk) in many ways.
Cutting straight to the point, if you are privileged to have a decent job going on for you, taking up income protection insurance wouldn’t be out of place simply because you can’t predict the future.
This particularly applies to those who intend to build a career for themselves in an organization. Truth be told, even the most reputable and established firms go ‘south’ sometimes, so it’s pertinent to be on your best guard. as regards securing your income.
Why do you need income protection insurance?
Though nobody wishes for it, You could lose the job, which may not necessarily be as a result of poor performance – business could not be sustainable due to industry competition, obsolete business model, poor management, among other factors.
Not having a backup income-sustaining plan that can keep you afloat till you start earning actively again can be a scary thought, hence the reason you should think of Income Protection Insurance.
What conditions can trigger a claim for an income protection insurance pay-out?
To make a claim under income protection insurance, some CONDITIONS to be met include
- job loss due to termination of employment
- business shutdown
- A disability that hinders one’s ability to work
- Critical sickness
It is the responsibility of every individual to conduct due diligence, that is ensure to do your research and patronize only reputable insurance companies before committing your premiums
Is there an alternative to this income protection insurance?
It depends on how you look at it, if you decide to put some money aside as an emergency fund, that may come in handy but will it carry you so far as an income insurance pay-out would?
You would need to weigh this practically of course depending on how much you can put aside and stick to not putting your hands in the fund unnecessarily.
It is worthy to note that Income protection insurance companies do not all provide the same scope of services as regards what they cover. So double-check with a company to avoid unpleasant surprises.
Insurance is often overlooked until it becomes crystal clear it should have been prioritized in one’s financial budget. So have a second thought before you push it aside again.
Side note: While insurance should not be overlooked, it is equally advisable to explore side-hustles and passive income investment opportunities as much as can. That way you are hedging your risks even better and not putting all your proverbial eggs in one basket.