Purchasing Income Protection Insurance is a smart and essential investment. It puts in place financial protection for you and loved ones if you are ever in a case where you can’t work and earn a paycheck. Being protected with this type of insurance is a big deal. This is why the insurance company wants to know a good deal of information about you because they want to know who exactly is going to be insured. But, there is a key factor that an insurance company wants to know about you before they decide to insure you: YOUR JOB & INCOME.
All About Your Job and Earnings
- For example, construction workers, mechanics, and electrical power line installers carry more of a risk to become injured and disabled on the job. Jobs like office workers, librarians, and bankers tend to carry a significant amount of lower risk for injury and disability.
- An insurance company will want to know about you:
- Are you employed?
- What kind of job do you perform?
- How much you are being paid?
- Your job title and your job responsibilities?
- Income is a key piece to the insurance company
- It is a significant part in determining what kind of disability policy you will be able to purchase.
- How low or high your premium will be.
- What benefits and options you will have in your policy.
- You will be asked to provide proof of income with an earnings statement and/or a tax form.
- Keep in mind that insurance companies will look at your income before taxes.
KEEP IN MIND: Income Protection Insurance will not replace your entire income if you were to become disabled and no longer able to work and earn an income. It varies, but insurance companies try to replace somewhere between 50-75% of your income before taxes. But, having this amount of money when you aren’t working is better than having $0.
How Much Of A Risk Are You?
Insurance companies have a rating system that will group certain occupations together and assign them a rating. This rating is determined by the duties of those occupations, their income, and the company’s experience with claims for those occupations in the same group.
- Different companies have different rating systems. One company may use Group A1, Group A2, Group A3, while another company may use Class 1, Class 2, and Class 3.
- The rating you are assigned gets analyzed along with your income and other work information.
Other Things They Will Want To Know
As discussed, your income and job information is one of the primary factors they use to determine if and how you will be insured with Income Protection.
But, that doesn’t mean they don’t need to know any other information about you.
Be prepared to be asked about:
- Your medical history
- Your lifestyle habits
- Whether you smoke or not
Also, it is mandatory to have a medical exam which includes and blood and urine sample.
Putting It All Together
It is obvious that insurance companies require a great deal of information about you.
They take everything into consideration, and ultimately insure you or you get denied.
Because this whole process can be a little overwhelming, it is helpful to work with an experienced Income Protection Insurance advisor. They can essentially walk you through the process and be the person to communicate to the insurance company in case there is a problem, or they need clarifications from you.
Connect With Us For Income Protection Insurance
To begin this process, call us at (800) 788-8921 or fill out our quick and easy Contact Form to be connected with an advisor.