There is a common view held by many Australians that they do not need personal income protection as they are covered by WorkCover or workers' compensation. It's important to note that you may not have sufficient cover if you believe workers' compensation cover alone is sufficient. The reality is that income protection and workers' compensation are separate and very different types of cover. Workers' compensation payments may not meet people's financial needs in a number of events.
Workers' Compensation cover is designed to protect employers from workplace claims from employees. It's not an income protection cover as:
- most illness and injuries occur outside the workplace and
- the coverage may not be adequate
Whereas, income protection protects your income if you are unable to work due to sickness or an accident regardless of whether it happened at work or elsewhere.
- 75% of Australians that were injured between 2005 - 2006 suffered the injury outside of work*
- Less than 36% of people receiving financial assistance following a work-related injury received financial assistance through Workers' Compensation**
- Over 2.6 million Australian aged under 65 are living with a physical disability*** including conditions like cancer, stroke, heart disease and depression that in many cases will not be covered by Workers' Compensation
Therefore it is extremely important that you have income protection to give you peace of mind that you and your family are always protected. To learn more about how we can assist you with ensuring you have the right level of income protection see our article "Protect your loved ones" or call us to speak with our income protection specialists on 03 8850 3333.
* AIHW (2008) Australia's Health 2008, Cat no. AUS 99, Canberra
** Australian Bureau of Statistics, Work-Related injuries 2009 - 2010
*** Australian Bureau of Statistics, Injury in Australia: A Snapshot 2004 - 2005