Comparing Income Protection Insurance in Ireland: Which Policy Is Right for You?
If you’re like many people, the thought of finding out you have a serious illness or injury can send a jolt of fear down your spine. While it’s true that most people will never experience this kind of trauma in their lives, there are still plenty of reasons why it’s important to know how much income protection insurance costs and what type works best for your needs. Income protection insurance is designed to help protect against unexpected medical expenses or loss of income due to an illness or accident.
Income Protection Insurance
Income Protection Insurance provides benefits in the event of a claim arising from your employment or self-employment. These claims can include:
- Wages lost due to illness or injury (including occupational disease)
- Sickness absence resulting from mental health problems, accidents at work and domestic violence.
- Death benefit for spouses and children under 18 years old who are dependent on you financially
How Much Does Income Protection Insurance Cost?
The cost of income protection insurance depends on your age and income, but it’s a good idea to shop around. If you’re young and healthy, you may be able to get away with paying less than $50 per month. But if you have a family history of serious illness or injury (or both), or smoke cigarettes, then the cost will be higher.
If self-employed, your costs will also be influenced by whether or not your business qualifies as “high risk” under Irish law—which means that they pay extra fees when they insure themselves through an insurer like Axa.
What Is the Policy Limit?
The policy limit is the maximum amount of income you can claim if you become unemployed, sick or injured. It’s usually expressed as a percentage of your annual income and will vary depending on how much money you’ll need to live on each year.
The most common type of income protection Ireland insurance in Ireland is a cash payout plan, which offers regular payments in exchange for an upfront fee (often around €2,000). If there’s no regular income coming into your bank account—such as from working part time or self-employment—you may want to consider buying short term policies instead: these provide cover only up until the date when they run out (typically two weeks after purchase), but they’re generally more affordable than long term ones because they don’t include any other upfront costs like premiums or benefits administration fees.*
Who Are the Claims Processors?
The claims processor is the person or company that handles your claim. They’re responsible for all aspects of processing your insurance policy, including:
- Making sure you file a claim on time
- Seeing that all paperwork is submitted in its entirety and accurately to avoid delays in processing
- Providing customer support during the process
What Are the Different Types of Income Protection Plans?
If you’re looking for a way to protect your income during a period of illness or disability, LTI is the most common type. It’s also the most flexible option because it can be designed to fit your needs.
LTI policies are often called “level term” because they cover you for one year after you start paying premiums and continue providing benefits until either:
- You reach an age where you no longer qualify under their terms or conditions; or
- You die.
Level Term Income Protection (LTI)
Level Term Income Protection (LTI)
This cover is a great option for those who want to receive regular payments, but don’t necessarily need the reassurance of disability cover. It’s also useful if you want to replace your salary while you’re out of work. LTI can be used as an additional source of income if you suffer a loss of income due to sickness or injury, and it will pay out a regular amount over the course of its duration. The amount paid out depends on how long it has been since your last payment was made; this is usually around 18 months after the date when you first signed up for LTI.
The most common level term available in Ireland is called ‘Level 5’. This means that if someone becomes unable to work due to illness or accident within five years from signing up then they’ll get 150% up until age 65 then 100% thereafter – although some insurers may have different terms depending on where they operate so check with them first before deciding on what level term would suit your needs best!
Defined Benefit Income Protection (DBPI)
Defined Benefit Income Protection (DBPI) is a type of income protection insurance that provides you with a monthly payment in the event of your death. This type of policy can be particularly useful if you have reached retirement age, as it will pay out your pension contributions and provide you with an income until you die.
The benefits are:
- You don’t have to pay any premiums upfront or take out other types of insurance on top of this policy; instead, it’s paid out automatically once per year by your employer or private insurer.
- The premium charged by DBPI policies tends to be lower than for other types because they’re more flexible than other plans—you can choose how much time before payout starts from 90 days up until five years from when loss occurred (or 19 years).
Investment Linked Income Protection (ILIP)
Investment linked income protection (ILIP) is a policy that pays out if your investment portfolio falls below a certain level. This type of coverage can be used to provide income while you are unable to work due to illness or injury, as well as death and disability cover.
The insurer will look at the performance of an investment portfolio selected by you, which may include stocks and shares, bonds or property funds. They’ll use this information to calculate how much ILIP is payable based on your own circumstances and future expectations for life expectancy. The amount paid out varies depending on how long it takes for your fund value to go down enough for them to start paying out on claims made against it; however there are limits set by legislation which mean that no claim can be made after five years from date when ILIP starts working in Ireland – even if that happened before any benefit was paid out!
ILIP policies are most often offered through banks but can also be bought online through companies like LifeCover Ireland Ltd..
Compare income protection insurance
You’re probably wondering how to compare income protection insurance. The process of comparing income protection insurance can be a little confusing, but there are some things you should be aware of before you make your decision.
- Consider the following factors when comparing income protection insurance:
- The monthly premium amount
- The coverage period (the length of time you’ll receive benefits)
- Whether or not there is a waiting period for new claims
- There are two main types of income protection policies in Ireland: level term policy and defined benefit policy. You may find that one type suits your needs better than another.*
It’s a good idea to determine what your needs are before you purchase an income protection policy. The type of policy that’s right for you will depend on your current financial situation and your future outlook. That said, there are benefits to both: an individual or group level LTI will help you make sure that you have enough money if something happens; while DBPI gives employers peace of mind in the event their employee is unable work because of illness or injury.