Your ability to earn an income is your most valuable asset, whether you're a young graduate, employed by a company or a business owner.

Not only is it the cornerstone of your financial future, it also assists you to accumulate assets over your working life.

Despite this, about 14 million households face a combined insurance shortfall of almost R29 trillion should the family breadwinner lose their income through death or disability, according to the Association for Savings and Investment South Africa.

"Most people feel that insurance policies take too much of their salaries. They want to enjoy their money while still alive and not give it all away to insurance companies. They mostly think of the now and not the future," Busisiwe Moeng, an adviser with Outsurance, says.

Findings from insurer FMIs latest #RealityCheck consumer survey support this sentiment. It found that less than half of the 7,000 people gauged did not have income protection or disability cover despite believing that they would face some sort of injury in their working lifetime.

"This results in people being twice as likely to buy life cover over disability cover, potentially leaving themselves without income insurance when an illness or injury does strike," FMI CEO, Brad Toerien, explains.

How does income protection insurance work?

Income protection cover ensures you can maintain a steady, tax-free income to meet your financial needs and obligations should you lose part or all your income when you are temporarily or permanently unable to work due to a disability or inability.

Permanent income protection benefits usually continue from the date of disability until the age of 65, while a business owner can be covered to the age of 70. The level of cover is usually limited to 75% of your latest taxable income.

The temporary cover is typically limited to 24 months but can cover you when your disability is one from which you may recover, like cancer.

With income protection, the life assurer takes the greater risk of paying you an income for the period for which you may require it.

If you take out lump-sum disability cover, the assurer will only pay out the sum for which you are insured and you have to ensure that that sum provides an income for as long as you need it.

This is why income protection policies often come at a hefty price when compared to other policies such as life or funeral cover.

How long do I have to wait to be covered?

The waiting period for income protection benefits varies from anything from seven days on temporary cover to 24 months on permanent cover and affects your premiums - the shorter the waiting period the more expensive your premium is likely to be.

If you earn a salary you will probably need a policy that pays out only after a month as you will enjoy sick leave or unemployment insurance but if you're a business owner, you may want a product that has a shorter waiting period as you're more sensitive to loss of earnings.

A policy with a two-year waiting period before it pays out on confirmation of permanent disability is designed to be used with a policy that offers temporary disability cover for two years for a disability that has yet to be confirmed as permanent.

"Think about it. You have 45 earning years ahead of you, or more if you don't retire at 65, what happens if you suddenly become disabled? So it's important to have a combination of cover.

"A lump sum is useful to pay off expenses like debts while income protection will provide for your future expenses," says Petrie Marx, a product actuary at Sanlam Personal Finance.

"I'd say you should take out income protection cover as soon as you start working," Moeng explains.

Keep pace with your salary and inflation

Make sure your income disability policy has an income benefit that will escalate each year, both before and after any potential claim.

This will make it more expensive but the way to mitigate this is to start the cover as early as possible to take advantage of lower premiums. An inflation protection on an income disability benefit will protect you against inflation eroding the benefit.