Is Income Protection Insurance Worth It?

When you think about insurance, you probably picture your car, home, or health — but what about your income? It’s your most valuable financial asset, and if illness or injury stops you from working, the loss of income can quickly create serious financial strain.

At Covermate Life, we believe that income protection insurance isn’t just a policy — it’s peace of mind. Here’s why it’s worth considering for anyone who relies on their income to support themselves or their family.

What Is Income Protection Insurance?

Income protection insurance provides you with a monthly benefit (usually up to 70% of your income) if you can’t work due to illness or injury. It’s designed to keep your financial life on track while you focus on recovery.

You can use these payments to cover:

• Rent or mortgage repayments

• Groceries and bills

• School or childcare costs

• Loan or credit card repayments

• Everyday living expenses

It’s protection for your paycheque — so you can maintain stability even when life is unpredictable.

Why Income Protection Is Worth It

1. Your Income Is Your Greatest Asset

Over a lifetime, your income likely adds up to millions of dollars. For example, someone earning $90,000 a year over 30 years will earn $2.7 million — and that’s before promotions or bonuses. Income protection ensures this long-term earning potential doesn’t vanish because of illness or injury.

2. Life Doesn’t Pause When You Can’t Work

Bills, mortgages, and family commitments don’t stop when your pay does. Income protection gives you financial breathing space, helping you keep your home, meet obligations, and reduce stress while you recover.

3. It Protects Your Lifestyle and Goals

Without an income, even short-term illnesses can derail your financial goals — from home ownership to retirement savings. With income protection, you can stay on track and avoid dipping into superannuation or savings you’ve worked hard to build.

4. It Supports Recovery — Not Pressure

When people lose income suddenly, they often feel pressured to return to work before they’re ready. Having an income stream during recovery means you can focus on getting well, not worrying about money.

5. Premiums Can Be Tax-Deductible

If your income protection policy is held outside super, the premiums are usually tax-deductible. This makes it one of the most cost-effective forms of personal insurance available in Australia.

When Income Protection May Not Be Suitable

Income protection may not be suitable for everyone. For example, those with significant savings or other financial safety nets might prefer to self-insure. However, for most Australians — particularly those with dependants, debts, or ongoing expenses — it can provide valuable peace of mind.

Understanding Your Options

Not all income protection policies are the same. Cover options and premiums can differ depending on your income, occupation, and the level of cover selected.

At Covermate Life, we can provide general information about how income protection works and the types of benefits available, helping you make informed decisions about your insurance needs.

We do not provide personal financial advice or take your individual circumstances into account. You should consider seeking advice from a licensed financial adviser before making any decision about purchasing or changing insurance cover.

The Bottom Line

So, is income protection insurance worth it? For many Australians, it can be a valuable safeguard — helping maintain financial stability, lifestyle, and confidence if illness or injury prevents them from working.

At Covermate Life, we’re here to help you understand how income protection works, what features to look for, and how it may fit into your broader financial protection plan.

Important Information

This information is of a general nature only and does not take into account your personal objectives, financial situation, or needs. Before acting on this information, you should consider its appropriateness and seek advice from a licensed financial adviser. Always read the relevant Product Disclosure Statement (PDS) before making a decision about an insurance product.

Talk to Covermate Life

Learn more about income protection insurance today. Get a quote today.