How Income Protection Insurance Supports Self‑Employed Tradies During Downtime

Running your own trade business whether as a plumber, carpenter, sparkie, or concreter is hard work. There’s no paid sick leave or employer backup when you take time off. That’s why income protection insurance is the safety net every self‑employed tradie should seriously consider.

At Tradies365, we specialise in insurance tailored to tradespeople. This includes income protection insurance so you can keep paying the bills if something knocks you off your feet. Here’s why it matters, how it works, and how we help.

Why Tradies Need Income Protection Insurance

1. Your Income Stops When You Get Hurt or Sick

If you can’t work due to injury or illness, there's no pay coming in.
WA research shows tradies make up nearly 60% of serious workplace injury claims even though they represent only about 30% of the workforce. Every day on the tools brings risk: ladder falls, tool accidents, back strain, burns or electrical shocks. Missing work for weeks or months can hurt your family’s finances fast.

2. Workers Comp Only Covers Work‑Related Incidents

Workers compensation isn’t always an option especially if you're a sole trader or subcontractor. It only pays if your injury or illness is directly tied to work. Income protection insurance fills the gap, covering illness or injury even if it’s not work‑related.

3. Cover Replaces Your Income

Good policies pay up to 75% of your pre‑tax income while you're off work. That keeps rent, mortgage, food, and bills in motion while you focus on recovery.

4. It’s Often Tax‑Deductible

Premiums are typically tax-deductible if paid personally, even more reason for sole traders to take this seriously.

How Income Protection Insurance Works

Benefit Period & Waiting Period

• Waiting period: choose how long after injury/illness before payments begin, usually 14, 30 or 90 days. Shorter wait = faster money but higher premiums.
  
• Benefit period: how long you receive payments often until recovery, up to age 65 or a fixed number of years.
  

Own‑Occupation Definition

Make sure the policy covers your specific trade. That way, even if you're fit for other types of work, you’ll still get paid while you can’t perform your trade duties.

Claiming Process

1. Notify the insurer ASAP in line with policy rules.
2. Submit claim form, medical docs, income proof.
3. Wait for assessment then begin payments after your waiting period ends .

Expect requests for doctors’ reports or additional documentation; the clearer your paperwork, the smoother the process.

Exclusions & Limits

• Pre‑existing conditions not disclosed at application may be excluded.
• Injuries from criminal activities or deliberate acts often aren’t covered.
• Some policies exclude high-risk hobbies unless specified.
• Benefits capped by percentage of income or total payout amount .

Why Working With Tradies365 Makes It Easier

Trade-Specific Expertise

We know that plumbers, builders, electricians and concreters all face different risks. We don’t sell generic policies, we tailor plans to match your trade and income situation.

Fast Quotes and Plain‑Talk Advice

We cut out the jargon. Get a quick online quote, and talk with someone who understands your trade and lifestyle, not corporate speak.

Flexible Options

Whether you're a sole trader or run a small crew, we help you pick a policy that fits balance the cost, waiting period and benefit to your cash flow and lifestyle.

Claim Support When You Need It

If something happens, we guide you through the claim, help you gather documents, and liaise with the insurer so you’re not left spinning.

Key Choices to Think About

1. Waiting period vs premium: A 30-day delay is usually a good trade-off more affordable than a 14‑day wait, but not too long to drain savings.
2. Benefit length: Want cover until age 65? Expect higher premiums. A 2–5-year payout term cuts cost, but only helps short‑term injuries or illness.
3. Own‑occupation vs any‑occupation: Own‑occupation means you claim when unable to perform your trade. Any‑occupation pays only if you can’t work any job much stricter.
4. Target payout level: Most tradies aim for 50–75% of income. Higher cover adds premium costs.
5. Own vs super funding: Cover owned personally is tax‑deductible and typically more flexible than insurance through super funds, which can have smaller definitions and payout limits.

Conclusion

For tradies who work hard every day building, fixing and creating, income protection insurance is the smart way to guard your most valuable asset, your earning capacity. It ensures that even if life throws a curveball, your financial responsibilities are taken care of.

At Tradies365, we help you find the right balance of coverage, waiting period and benefit period for your trade and situation. You get fair premiums, straightforward advice, and support if you need to claim.

FAQs

How much does income protection insurance cost?

Premiums depend on your age, health, trade and coverage level. Trades are higher-risk, so costs can exceed those for office-based cover. Many tradespeople pay a few dollars a day up to several hundred a month, depending on benefit amount and policy setup.

Is income protection tax-deductible in Australia?

Yes if you pay personally. If it’s held in super, you get a 15% rebate, but you miss out on full deduction at your tax rate.

What if I can still do some work, but not my trade?

If your policy includes your own‑occupation terms, you’ll still receive benefits even if you can earn money in a different line of work. Without that, you may get nothing.

Is income protection better than workers comp?

They serve different roles. Workers compensation only covers work-related injuries or illnesses and often pays less. Income protection covers injury or illness regardless of cause and replaces more of your income.

Can I claim income protection if I’m self-employed?

Absolutely. As a sole trader or contractor you’re not covered by employer insurance. Income protection is designed for self-employed people to protect their personal income stream.

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