Could you cope with losing your most important asset?
No, we don’t mean your home, or your car. We’re talking about your income. Your ability to earn a living is incredibly important – it keeps a roof over your head, keeps the bills paid, keeps your retirement savings growing and keeps you being able to enjoy your way of life off the clock.
Time away from work for an extended period wouldn’t just impact on that lifestyle – it could be financially devastating for you and your family. If you suffered an injury or extended illness, for example, you could face medical expenses, the erosion of your savings or even the forced sale of your home.
Yet income is all too often overlooked when it comes to insurance protection – that quintessentially Kiwi ‘she’ll be right’ attitude making us a little too complacent when it comes to our ability to earn a living.
But it happens more than you might think. Each year a staggering 54,800 New Zealanders are impacted by someone in their household being unable to work for three months or more due to illness1. What’s more, 47% of working Kiwis aged between 18 and 64 say they wouldn’t have enough money to survive longer than one month after using their sick and annual leave2.
While we’re lucky to have access to Government-funded assistance, ACC only pays if you suffer an accident, and Work and Income benefits are unlikely to be enough to cover your living and lifestyle expenses.
Get back on your feet faster
And that’s where the value of income protection lies. It pays you up to 75% of your pre-disability income to cover your living and lifestyle costs while you’re off work due to a disability or extended illness. A range of recovery and rehabilitation benefits are also available so you can tailor your cover to meet your needs and budget. The aim is to get you on your feet – and back to work – faster.
You can choose how much of your income to insure, when you want to start receiving benefit payments and how long you will be paid for. Most income protection products also provide optional benefits such as payment of your KiwiSaver contributions while you’re away from work, or additional payments if you break an arm or leg or suffer from cancer.
Here are a few of the benefits of Fidelity Life Income Protection:
It enables you to continue earning while you recover
Some people, especially the self-employed, find it hard to fully step away from work, even if they are totally disabled. Fidelity Life allows you to keep working up to 10 hours per week, if you need to, without affecting you monthly benefit payment. This means you can focus on recovery and returning to work faster.
It protects your benefit from inflation every quarter
Our Claims Escalation Option3 ensures your monthly benefit continues to keep up with inflation by linking it to the Consumer Price Index every quarter, rather than annually. This means that claims lasting less than a full year can still be protected against rising inflation costs.
It lets you stick to a budget
With our level term premium option, you can be certain your premium is actually level – your premium won’t increase4, even if you choose inflation protection, making it ideal if you’re on a fixed budget.
Most people are surprised to learn that income protection cover is affordable. For the equivalent of a daily cup of coffee for a man, or two cups for a woman, you can make sure that if you’re ever unable to work due to a disability or extended illness, the last thing you have to worry about is money5.
And for many people, its money well spent. In 2017 Fidelity Life paid out more than $23.2 million in income protection claims. The youngest claimant was 22 years old, and the average age was 44
To find out how income protection could help you, please get in touch.
Disclaimer – the information contained in this document is a convenient summary of the key points and is general in nature. Definitions, benefits, standard exclusions / limitations, terms and conditions are contained in the full policy documentation. Please refer to current policy wordings for specific details.
3 Requires payment of additional premium.
4 Subject to any tax regulatory changes.
5 Depends on variables including your age and level of cover.