In our delightful capitalist society, the magic money machine of life is the one thing you depend on most.
And sure, you can’t buy happiness, but money definitely helps.
It’s why your income is so important – and why we spend all that time going to school and then potentially onto college or at work.
But what happens if you can’t work for a long time?
Maybe you’re in a car accident or experience depression or fall ill.
That magic money machine is about to stop chugging out the good stuff.
It’s why Income Protection is so important. It’s a type of insurance that pays you up to 75 per cent of your salary if you can’t work long-term FOR ANY REASON.
But if you’re someone who works a job that insurers categorise as risky (specifically Class 3 and 4 – see below), you might be facing massive, stonking premiums.
Which might lead you to believe insuring your income is out of reach.
This is where Wage Protector can help.
A quick introduction: all the insurers use underwriting to set the cost of your premiums – which is how much you’ll pay, monthly, to be insured.
Underwriting is a complex mix of maths, science, and risk analysis. The underwriters assess your risk based on family history, your current health and the job you do. If the underwriters believe there is a bigger chance of a claim on your policy than the general population, well, you’ll pay more.
When it comes to Income Protection, the most important thing here is the type of job you do. If, for example, you work in bomb disposal, it’s safe to assume the insurers won’t be in a rush to cover you. On the other end of the scale, you might be surprised to hear that if you’re a carpenter or a nurse, you could be facing higher premiums than expected.
The classes rank from 1 to 4. The insurers rank occupations based on their history of claims and the risk of injury in that occupation.
Class 1 is your standard desk jockey. Me, for example.
Class 2 is an occupation that involves some light manual labour – a dentist fits in here, as does a sales assistant.
Class 3, then, involves non-manual and manual occupations. Nurses, midwives, mechanics – you get the gist.
Class 4 is manual labourers. This includes jobs like general operatives, builders, and tradesmen.
If you fall into Class 3 and Class 4, expect your premiums to be more expensive. However, Wage Protector is here to make things a bit easier on your póca.
Wage Protector is pretty similar to Income Protection. In fact, when you hear the definition, it’d be fair if you think that they are the same thing.
Wage Protector provides you with a replacement income of up to 75 per cent of your salary if you can’t work due to any illness, injury or disability.
The big difference will be in price and the duration of the payout (see below).
Income Protection is pricey for Class 3 and 4 workers. Wage Protector is intended to be a cheaper equivalent. Your policy will protect you in two ways:
Here’s a handy chart illustrating the differences between Income Protection and Wage Protector
One thing worth noting is that the deferral period is slightly different. This is the amount of time you have to be off work before getting the replacement income.
In the case of traditional Income Protection, it’s 4, 8, 13, 26, or 52 weeks. For Wage Protector, 52 weeks isn’t an option.
You can claim tax relief on both Income Protection and Wage Protector (20 or 40 per cent), which means your premiums may well be less than you expect.
Compared to income protection, it’s a LOT less.
Let’s take two examples, a nurse and a carpenter.
Quote Type: Full Income Protection
First Person: Non-Smoker, born on 01/04/1985
Cover Amount: €1,516 per month until age 65.
Occupation Class: Nurse (Hospital) (Class 3)
Deferred Period: 26 weeks
Monthly premium: €34.81
Wage protector is half the price at €16.81 per month
Quote Type: Income Protection
First Person: Non-Smoker, born on 01/04/1981
Cover Amount: €23,400 per year until age 65.
Occupation Class: Carpenter (Class 4)
Deferred Period: 13 weeks
Monthly premium: €146.64
Wage protector is less than half the price at €60.45 per month
There is no puppy.
If you want a puppy, you should get one. But remember that, unlike children, a puppy isn’t just for Christmas.
With Aviva, if you go for Income Protection or Wage Protector, you automatically get a bunch of solidly sound extras. Forthwith (imagine me saying that as I doff an elaborate top hat):
Fear not, gentle reader.
If you’ve applied for Income Protection before and didn’t go with it because it was too expensive, it’s worth taking Wage Protector a spin.
You can’t use an online quotey-majig to get your quote, but I can get you one – it’s what I was born for – if you fill in this short questionnaire or if you give me a bell on the most useful relic to the past, the good old-fashioned telephone.
I’m on 057 93 20836.
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As Ireland's leading independent insurance broker, we specialise in comparing the rates and policies from the top five Irish life insurance providers and offering the very best value quotes to suit the individual needs of our clients. Our expertise lies in finding a suitable insurance plan for those with specific needs, be it a particular illness, occupation or claim history, we've got you covered in every sense!