How income protection insurance will help your family's financial security

Income protection insurance plans ensure that your income is protected and your family has money in crises

As Indian families examine financial security, one product gaining attention is income protection insurance.

 

“Income protection is more than just a safety net; it is a commitment to your family's future. It ensures that, even in times of uncertainty, your loved ones can maintain their lifestyle and focus on healing and moving forward,” said Rahul Agarwal, founder and chief executive officer, Ideal Insurance.

 

Income protection is a type of insurance that provides financial support to policyholders who are unable to work due to an accident or illness. It is also known as loss of earnings insurance. 

 

Murli Jalan, chief distribution officer at Bharti AXA Life, explained some of its benefits

 

Protection against inflation: With prices constantly rising, such an insurance plan helps against impact.

 

These plans can help you maintain your current standard of living, ensuring that you and your family don't have to compromise on your quality of life.

 

Reduces stress: Knowing that your family is financially protected can alleviate emotional and psychological stress.

 

Enhance financial planning: By providing a regular income stream, these policies can help you protect your savings and avoid depleting your emergency funds.

 

Key considerations

 

When contemplating whether to purchase income protection covers, consider the following:

 

Assess your family's needs: Determine how much monthly income your family would require in your absence. This should reflect their current lifestyle and future aspirations.

 

Understand policy types: Familiarise yourself with different types of policies available. For example, some plans offer regular monthly payouts while others provide a lump sum payment upon death. Choose one that aligns with your family's financial management preferences.

 

Review premium costs: The cost of premiums can vary based on factors such as age, health status and the level of coverage. It is  essential to compare different policies and understand what you will be paying over time.