Income protection is a type of insurance policy that pays you a monthly income if you are unable to work due to an accident or illness. Income protection can help you protect your financial future and replace lost income during times when you would not be able to work.
How much do you earn?
Your income is a key factor in determining how much you would pay for income protection. If you earn more, you pay more; if you earn less, you pay less; and if your income is close to the average income in Ireland (which is approximately €34,000), then we’ll charge an average amount.
We use industry standard rates of interest to calculate what we call the cost of cover (the premium). These rates are set by law and known as statutory solvency margins or SMRs. They vary depending on the type of policy chosen and age at commencement but are typically between 4-6%.
What is your age?
Age is a factor in determining premiums. The older you are when you purchase your income protection policy, the higher your premiums will be.
The reason for this is that insurance companies base their pricing on statistics collected from previous claims experience. By using this data they can determine how much risk they face by offering different levels of cover at different ages and then set appropriate prices accordingly.
What is your gender?
Another factor to consider is gender. Men have a higher life expectancy than women, which means they pay more for income protection. However, this can be offset by the fact that women are more likely to be carers and therefore have different priorities when it comes to income protection.
Will you get sick or injured in future?
In order to determine how much you would pay for income protection, it’s important that we first understand the likelihood of you getting sick or injured in future. The following questions will help us understand this:
- What is the likelihood of you getting sick or injured?
- How likely are you to get sick or injured?
- How likely are you to get sick or injured in future?
Have you paid a premium for income protection in the last three months?
If you have paid a premium for income protection in the last three months, then this is what will happen:
- If your payment was made by credit card or debit card, no extra charges will apply.
- If your payment was made by cheque or bank transfer, there may be an additional charge of up to EUR 12 for each transaction.
There are many factors when considering how much it would cost for you to pay for income protection.
There are many factors when considering how much it would cost for you to pay for income protection. The following are some of the most common:
- How Much You Earn
The more you earn, the higher your premium will be because it is assumed that people in higher-paying jobs have a greater risk of being unable to work due to illness or injury. However, this does not mean that everyone who earns less than €30,000 per year should automatically qualify for lower premiums at all times! If you’re in good health with no recent history of illness or injury then there’s no reason why a low-income worker won’t be able to get cover at an affordable rate just as easily as someone earning significantly more each year
Conclusion
We hope this income protection calculator has helped you to understand how much income protection can cost in Ireland. If you want more information on how to get covered, please contact us today.
