Standard vs Plus Income Protection
Income Protection comes with a number of different options for you to choose from, including what policy type you would like.
Like trauma insurance, insurers typically offer a ‘Standard’ or a ‘Plus’ Income Protection policy, with the ‘Plus’ policy offering a number of additional included benefits for a slightly higher premium.
Generally, other choices you have included waiting and benefit period, agreed value vs indemnity and which premium structure you would like will still be available for both policy types.
Standard Income Protection
Generally the cheaper of the two options, ‘Standard’ Income Protection offers a number of core built-in benefits. It is designed to provide peace of mind to those insured that they will have financial support if they suffer from a sickness or injury and are unable to work.
Plus Income Protection
‘Plus’ Income Protection is generally more expensive than Standard Income Protection as it provides the same core benefits as a ‘Standard’ policy as well as additional benefits which generally assist with expenses that may be incurred as a result of your sickness or injury.
Standard vs. Plus
While benefits offered will differ between insurers, below are some of the general benefits available with Standard and Plus policies:
|Standard Income Protection||Plus Income Protection|
|Waiver of Premium||Bed Confinement Benefit|
|Basic Death Benefit||Accommodation Benefit|
|Specific Injury Benefit||Child Care Benefit|
|Benefit Indexation||Family Care Benefit|
|Recurrent Disablement||Nursing/Special Care Benefit|
|Severity Benefit||Rehabilitation Benefit|
|Total Disability Benefit||Rehabilitation Incentive Benefit|
|Partial Disability Benefit||Relocation Benefit|
|CPI Increases||Trauma Benefit|
The below premium comparison is based on a:
- An annual salary of $100,000 (Monthly benefit of $6,250)
- Waiting period of 30 days
- Benefit period to age 65
- Level premiums
*While premiums are based on real quotes, they are examples only and may not reflect actual premiums available. Please speak to one of our advisers to get more accurate quotes.
Which policy should I take out?
Which policy to take out is an individual decision and tt may come down to affordability. Don’t forget, if you want a policy with more benefits but are budget conscious, there are a number of things you can do to make the policy more affordable such as removing CPI increases, reducing your level of cover or changing your premium style.
You should always speak to your financial adviser before making any decision.
Plus Income Protection Built-in Benefits
While Plus Income Protection will differ between insurers, the general additional benefits available include:
Bed Confinement Option
If you are required to be confined to a bed due to a sickness or accident, you can be reimbursed up to 1/30th of your monthly benefit for each day you are confined to a bed during the waiting period.
Child Care Benefit
Pays a benefit of 4-5% or $400-$500 (depending on insurer) to help pay for child care assistance while you are totally disabled. Prior approval must be sought from your insurer in order to claim the benefit.
Payment only relates to additional child care assistance required due to total disability, not child care that is already in place.
The benefit is generally payable for up to three months.
If you are totally disabled and are required to be confined to a bed because of your sickness or accident, and you are more than 100km from home and an immediate family member is required to be with you, or if an immediate family member is required to travel more than 100km from their home, an insurer will reimburse accommodation cost of generally $250 – $500 per day for up to 30 days.
Family Care Benefit
Pays a monthly benefit of up to 50% of your monthly benefit is an immediate family member’s income is reduced as a result of looking after you while you are totally disabled.
This benefit pays the cost of an approved rehabilitation or re-training program which results in you being able to return to work.
The amount payable is generally 3-12 times your monthly benefit.
Rehabilitation Incentive Benefit
This benefit pays a one off benefit if you return to full time paid employment for six consecutive months following participation in a pre-approved training program.
Trauma/Crisis Recovery Benefit
If you are diagnosed with a listed trauma condition or crisis event, a benefit of up to six times your monthly benefit will paid, generally regardless of whether or not you are totally or partially disabled.
You may be able to elect to have this benefit paid as either a lump sum or in monthly instalments.
Relocation/Domestic Travel Benefit
If you become totally or partially disabled while either overseas or interstate (depends on insurers coverage), your insurer will reimburse the cost of a single airfare to Australia or your home that is up 2 – 3 times your monthly benefit.
Nursing/Special Care Benefit
Reimburses the cost of a home nurse or professional home carer if you:
- Are required to in the care of a nurse or professional home carer
- Are totally disabled, confined to a bed or need to be close to a bed
- Are not in a hospital or not in an institution that provides nursing care.
The amount reimbursed will differ between insurers.