Put simply, Income Protection Insurance is a monetary safeguard that acts as a safety net if an individual is unable to work due to sickness or injury. The income benefit will be paid in monthly instalments to the employee if they are unable to work for an extended period of time.

Are Part-Time Workers or Casual Employees Eligible for Income Protection?

As a part-time worker or casual employee, eligibility varies across different providers. Generally, it is required that one work a minimum of 20 hours per week to qualify. Part-time workers can choose the amount of cover they require. Insurers usually offer a payout of up to 75% of the worker’s income. Rates can be stepped (increase with age) or level (unchanging over time) depending on the policy, and will also vary depending on the policy’s waiting period. Other factors that contribute to the cost of insurance include the employee’s age, gender, health, and proclivity to engage in hazardous activities. It is also important to note that payments are tax-deductible.

How Do You Make an Income Protection Insurance Claim as a Part-Time Worker?

A part-time worker would make a claim if they were unable to work, and their reasoning would comply with the stipulations of their insurance contract. Part-time employees should not claim on their insurance if they incur an injury or illness while performing their job. In this instance, the employer is responsible for the worker’s compensation and should have their own insurance policy to cover the costs. In addition, a claim cannot be made if the employee is still being paid, even if they are not working. The waiting period will only begin once the employer ceases payments.

Part-time workers should look into Income Protection Insurance if they rely on the wage and would struggle to make ends meet in the event that they can no longer perform that role. It is important to consider insurance if an employee has dependents, for example, children, who would also be impacted by their inability to work. If an employee is engaged in part-time work in order to procure savings but does not rely on the income, for example, a student still living with their parents, it would be advisable not to take out insurance.

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