Agreed Value or Indemnity Value Income Protection Insurance?

It is a always a wise decision to protect your income, and Income protection insurance is the only way to give you that piece of mind. However, there are still many considerations to take into account and you will need to be more familiar with the specific terms to better understand such insurance products, especially when it comes to features and benefits.

How do you choose between an income protection insurance policy with an indemnity value and or an agreed value?
Well that depends on your situation?

With indemnity value income protection insurance, you will need to present and submit your financial documents as proof of your income upon filing for any claim. Thus, there is no more need to prove your income amount when you apply for an insurance policy. As always, the value of the claim could be up to 75% of gross income (in most cases) or the sum that is insured. This makes this type of income protection insurance policy much cheaper especially (you usually save up to 10% of the premium) when it comes to rate or cost of premium payment.
An agreed value policy does not require any financial document as income proof upon filing for any claim. However, such documents are required during the application stage. Thus, this type is considered the best for people whose income is subjected to fluctuations and changes, such as the self-employed and small business owners.

No matter how much your regular income has been reduced from the time of the application until the filing for claim, you would be entitled to a fixed amount of claim. The setback is that premium rates are usually up to 10% to 20% higher compared to how much you pay for your indemnity value insurance policy.
Choose the best type of insurance based on your situation. The experts at CCAFP can help you to select the best income protection insurance policy, call them today!