How much will you receive?
Income protection policies have a formula for calculating how much you will be paid. It may depend on your income at the time you took out the policy or your income over a number of years. The schedule attached to your policy will tell you how much you will receive every month.
The insurer may not check that you have correctly stated your income at the time you take out the policy. They may only check it when you make a claim. If, for example, you are self-employed, make sure you can produce tax returns, invoices or other documents establishing your income. Otherwise, the insurer could pay you less.
For further information on income protection insurance, visit ASIC's page on Insuring Your Income.
See Part 1
See Part 2
© Australian Securities & Investments Commission. Reproduced with permission.
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