The Finance Algorithm

Income Protection Calculator

See the most an income protection policy could pay under APRA's limits, how it compares with your expenses, and the savings your waiting period needs.

Updated October 2026Built and checked by MaverickHow it's calculatedReport an error

Your numbers

Updates as you type
$
$8k

Your gross monthly income, averaged over the last 12 months: benefits are based on it

$
$5k

Mortgage/rent, food, utilities, insurance, transport: the minimum to get by

$
$15k

How much savings you have to cover expenses during the waiting period

Days before the first payment. A longer wait generally lowers the premium, and your savings must cover it.

How long benefits are paid if you can't work

Check your super statement: some funds provide income protection by default

35

Sets how long a 'to age 65' benefit period could pay

The button asks our AI to explain these figures in words.

Income protection cover

Monthly benefit

$5,600

after 6 months; up to $7,200 before

Against expenses

112%

$600/mo left over

Waiting cash needed

$14,795

90-day wait, savings cover it

Most it could pay

$2,025,600

over 30 years of benefits

What's covered after six months

For policies sold since 1 October 2021, APRA limits benefits to 90% of pre-claim income for the first six months and 70% after. Policies can pay less; older policies may differ.

$8,000monthly income
Covered (70%)70.0%
Not covered (30%)30.0%

Savings needed to reach the first payment

Your essential expenses until the waiting period ends. A longer waiting period generally means a lower premium, and needs more savings.

$4,93230d$9,86360d$14,79590d
Premiums held outside super are tax deductible. You can claim income protection premiums you pay yourself, but not premiums paid through super. Premiums depend on your age, health, occupation, waiting period and benefit period, so only a quote gives one. Check your super statement: some funds provide income protection by default.

How it works

If you earn $100,000 a year and have 30 years until retirement, that's $3 million in future earnings. Income protection insurance replaces part of your pre-tax income if you're unable to work due to illness or injury, based on what you earned in the 12 months before. For policies sold since 1 October 2021, APRA limits the benefit to 90% of that income for the first six months of a claim and 70% after. Unlike workers' compensation, which only covers work-related incidents, it can cover illness and injury outside work. This calculator shows the most a policy could pay against your expenses and the savings needed for the waiting period; it doesn't price cover, because premiums depend on the insurer's assessment of you.

  1. 1Enter your monthly income and essential expenses.
  2. 2Add your emergency savings, which have to carry you through the waiting period.
  3. 3Choose a waiting period and benefit period.
  4. 4Check if you have existing cover.
  5. 5See the most a policy could pay and whether your savings cover the wait.

Worked examples

Office Worker, Family Provider

Alex, 38, earns $9,500/month. Essential expenses: $6,500/month. Has $20,000 in savings. No existing cover.

A new policy could pay up to $8,550/month for the first six months (90%) and $6,650/month after (70%), which covers his $6,500 of essential expenses. A 90-day wait needs about $19,200 of savings, which his $20,000 covers. With a 'to age 65' benefit period, payments could run for 27 years.

Tradesperson, High Risk

Jake, 32, is a carpenter earning $7,000/month. Essential expenses: $4,500/month. Has $10,000 in savings.

A new policy could pay up to $6,300/month for the first six months and $4,900/month after, above his $4,500 of essential expenses. A 60-day wait needs about $8,900 of savings, which his $10,000 covers; a 90-day wait would need about $13,300. Insurers price manual occupations higher, so his quotes will reflect that.

Questions people ask

Is income protection through super worth it?
It depends on the fund's terms. Cover in super is often for a set amount and available without medical checks, but premiums come out of your super balance and can't be claimed as a tax deduction. Check the fund's benefit period, definitions and exclusions in its PDS, and compare them with a separate policy before deciding.
What's the difference between 'agreed value' and 'indemnity'?
Agreed value: the insured amount was agreed when the policy started, regardless of income at claim time. Indemnity: the benefit is based on your income before the claim. Insurers stopped selling new agreed value policies in 2020 under APRA's measures, so new policies base the benefit on your earnings in the 12 months before you claim. Older agreed value policies can continue.
Does income protection cover mental health?
Many policies cover mental health conditions, but some limit them, for example with a shorter benefit period for mental health claims. Check the PDS (Product Disclosure Statement) for the policy's mental health terms.

The terms, in plain English

Income Protection Insurance
Insurance that replaces part of your pre-tax income if you can't work due to illness or injury. Also known as salary continuance or disability income insurance.
Waiting Period (Elimination Period)
The time you must be unable to work before benefits start. Policies offer from 14 days to two years. A longer waiting period generally means a lower premium.
Benefit Period
The maximum length of time benefits will be paid for a single claim, commonly 2 years, 5 years or to age 65.
Agreed Value vs Indemnity
Agreed value: benefit amount set at policy start (no longer sold to new customers since 2020). Indemnity: benefit based on your income before the claim.

Official sources

Life Insurance Calculator

Calculate death cover to complement your income protection.

TPD Insurance Calculator

Calculate Total & Permanent Disability cover for worst-case scenarios.

Emergency Fund Calculator

Build savings to cover the waiting period before IP benefits start.