The amount of income protection cover you need will be determined by your salary. In Australia the maximum amount of cover you can get is usually limited to:
•If you are employed: 75% of your current gross salary (including employer packaged fringe benefits and superannuation contributions).
•For self employed: 75% of the income generated by the business due to your personal endeavour less your share of expenses.
•A lower percentage of income may apply above certain income limits ($250,000 for example) and overall maximum levels of monthly benefit sum insured will apply.
You need to consider what the costs are of meeting your debts (mortgage, etc.); providing sufficient funds for a spouse, children or other dependents; and maintaining your assets & investments. Remember, the point of income protection insurance is to provide an income stream if you can no longer work.
