Income Protection Insurance

As a tradesman there are a number of different types of insurance you need to consider. Out the policies available, one of the most important for a tradesman is income protection.

Income protection is designed to protect and replace you income in the event that you are unable to work for a period of time due to illness or injury. It does this by paying you a monthly benefit until you are able to return to work.

Tradesman income protection insurance is available for almost all trades, including carpenters, electricians, plumbers and many more. The premium will change depending on your trade, with riskier trades attracting higher premiums.

Your income can generally be protected up to 75% of your pre-claim income. This amount must be nominated at the time of taking out your income protection policy, but can be changed at any time prior to a claimable event.

As well as choosing the monthly insurance benefit, you must also choose a waiting period and benefit period for your income protection insurance. The waiting period relates to how long you must be unable to work before you can claim, and the benefit period relates to how long you will receive benefits for once you are on claim.

The benefit period can range from one year through to age 65. Once you are unable to work and have passed the waiting period, you will continue to receive benefits until you are able to return to work, or until the benefit period has been exhausted, whichever is sooner.

Most tradesman go with a 30 day waiting period on their income protection insurance, which means they must be unable to work for 30 consecutive days before making a claim.

You can bring payment of your benefit forward by selecting an option called 'day 1 accident cover'. This option is very popular with tradesmen - especially young tradesmen - as they are more likely to be away from work due to an accidental injury rather than illness.

With day 1 accident cover your monthly benefit will be back-paid to day 1 and you will only have to be away from work for 3 consecutive days rather than the whole waiting period. This option means you'll get paid sooner, and potentially you'll get paid more.

Income protection insurance is an important part of any tradesman insurance package, but it is especially important for tradies with a mortgage to pay and a family to support. If you couldn't work for a month, a year, or longer, who would keep the roof over your head and food on the table? Income protection is a must in these circumstances.

Income protection insurance is generally 100% tax deductible, and you can even have the premiums paid out of your super balance. There are some important factors to consider if placing your income protection in your super fund, so we recommend speaking without your financial adviser first.

The process for applying for income protection is fairly straightforward for most tradesmen. The first step is to obtain quotes, which Trade Risk can help you with. The next step is to choose an insurance company and then complete the paperwork.

The experts at Trade Risk can help you with the whole process to ensure you're getting the right income protection policy to match your needs and your budget. We can also help you with all the paperwork to keep things as simple as possible for you.

If you're a tradie, and especially if you're a self-employed tradie, income protection is one of the most important covers to have in your trade insurance package. You hope you'll never need to use it, but when things go pear shaped you'll be glad you had it.

For more information or to obtain a quote on your tradesman insurance please give us a call or complete our online quote request.

Information on this website should be seen as general advice only, as it does not take into account your personal circumstances. You should not act upon any information on this website without first consulting a qualified financial adviser or insurance broker
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