Income protection insurance not only covers employed individuals. These days, it is also offered to self-employed people. Now, a person who owns and manages his own business can rely on the insurance to make sure he will continue to get income even if he suddenly becomes unable to work. While in the past, self-employed people are not provided the same income protection level as those who are employed, now, a self-employed perhttp://www.blogger.com/img/blank.gifson can rely on his insurance cover.
Income protection insurance for self-employed individuals can provide short-term to long-term benefit payments. Are you considering applying for and taking one? You may choose from available plans that may last until your expected retirement age. If you need to file a claim for a long term because of a serious illness or injury (whereon you may possibly not be able to return to work), your payout can be provided each month until the end of the policy term. You may also opt for multiple claims if your medical condition or injury will disable you to work for the short term.
How much can income protection cover especially for self-employed individuals? If you will scour the market, you may find income protection insurance that covers about 50% of gross monthly income. That means in case you will be disabled to work, the insurer will provide you or your family with a monthly amount equivalent to half what you used to earn each month when you were still able to work. There are insurance products that cover 65% to 75% of gross monthly earnings.
Once the claim is filed, the insurer will determine the self-employed individual's monthly benefit level, which is based on regular earnings during point of claim. Some insurance companies average income for the past three years while others look at the income history for the last 12 months. The enterprise's tax returns and bank statements can be examined for this purpose.
For self-employed individuals, income protection can be sufficient for making sure stability is retained in case they will be struck by severe illness or injury. Payout from income protection insurance can be used for various purposes. The self-employed policyholder may decide the use the proceeds to pay mortgages, monthly expenses of the family, utility bills, or other regular outgoings. The funds can also be used for business-related purposes. In the end, income protection insurance is a must-have for self-employed individuals.
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