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The 'waiting period' is the time between you becoming unable to work and receiving your first income protection payment. You can generally choose a waiting period between fourteen days and two years. A shorter waiting period usually means a higher premium.
Because most disability events are temporary, insurance coverage for them is cheaper when the policyholder agrees to wait longer before receiving claim payments. For example, if you break a finger, it may only be 2 months before you are able to do your job again. If you agreed to wait 60 days before receiving claim payments, then the insurer will not have to pay a claim for your event. This reduction to your risk is reflected in the lower price that you paid to purchase coverage (lower premiums).
If you don't have sufficient sick leave or other benefits or available cash during your waiting period, you could be without any income until your waiting period expires and you start receiving Income Protection benefits.
Often, insurers pay claims in arrears. It is important to know the details of your particular product so you can accomodate the period of time before you actually receive your benefit claim.
When you're considering income protection insurance, it is important that you have a clear understanding of the proposed waiting period as this plays a large part in your income protection cover claim, and if or when you may be eligible to have benefits start accruing to you.
Review. To review your income protection cover, call us today on 02 9417 6011 at no additional cost.
Obtain. To obtain income protection cover, call us today on 02 9417 6011 for a complimentary meeting.
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