Construction Safety Week is a national awareness campaign aimed at promoting positive safety and health amongst Ireland’s 159,000+ construction workers, clients and industry stakeholders.
The goal is to generate engagement amongst CIF members and non-members alike, to promote a culture of safety, health and wellbeing in construction.
This year, the campaign ran over the entire month of October. I thought I would discuss the importance of financial health and how you can protect yourself and your family. During your working life, the risk of being diagnosed with a serious illness is a greater risk to you than death.
Despite this fact, many people have one or more forms of Life Assurance, such as mortgage protection, but nothing to protect their finances in the event of illness.
Income Protection pays you a regular, recurring, taxable income if you’re unable to do your job due to any illness. Whereas Serious Illness cover pays you a onetime, tax-free, lump sum on diagnosis of an illness defined in the policy (typically covers approx. 50-70 pre-determined serious illnesses including the three most common: cancer, heart attack and stroke).
Income protection insurance is designed to provide you with a replacement income of up to 75% of your salary if you’re ill or injured, and can’t work. It helps give financial security and peace of mind, so you can focus on getting better. In my opinion, Income Protection is one of the most important insurances you can have in place, to protect your finances.
• Pays you a regular income if you can’t work because of an injury or illness while employed.
• You can have cover up to 75% of your total yearly earnings, less any benefits from the state or other income protection plans.
• A claim will be paid until you return to work or your plan ends. The amount you get will be treated as income for tax purposes.
• Normally the benefit is paid when you are out of work for longer than 26 weeks. This is called the deferred period. There are other shorter/longer deferred periods available.
• The cost will depend on your age, your health, deferred period, and agreed level of cover.
Serious Illness Cover
Some illnesses can have a significant impact on your life. They can stop you from working and your recovery may require assistance and time. That’s where serious illness cover comes in. Serious illness cover (sometimes called critical illness cover) provides you with financial support if you are diagnosed with a serious illness.
• Protects the well-being of and provides a lump sum payment to your family if you are unable to work.
• Provides a tax-free, cash lump sum to you if you are diagnosed with a specific serious illness. (subject to policy terms and conditions).
• Some providers have innovative cancer-only option available.
• Your policy can cover more than one person.
• You can increase cover at times when you need it.
• Furthermore, Specified Illness cover can be written as part of a Key Person Policy or Shareholder Protection Policy. This provides additional cover for businesses.
Check what benefits your employer provides. While most employers offer life insurance, not all include income protection or serious critical illness cover.
If you are a single person with no dependents, income protection or serious illness cover could be a good fit for your needs if you become ill. This money can be used to pay for things such as household bills or medical expenses that are not under your health insurance.
And if you have a family, how would they cope if you became ill and were unable to work? Having financial support at a time of physical and emotional stress can ensure that you are able to take the time off work, pay for specialist treatment or even cover day-to-day household bills such as childcare.
Every year, safety week reminds us to keep ourselves and our workers safe from harm. You should also use it as a reminder to safeguard your future by reviewing your finances and taking steps to keep them safe. Protection is not just in case we die, but in case we live – or in this case, if we are unable to work if we are ill.
For further information, contact Darragh Hogan in Milestone Advisory via email ([email protected]), or phone (01) 406 8020. Milestone Advisory DAC t/a Milestone Advisory is regulated by the Central Bank of Ireland.