Income Protection Insurance for Doctors
At Rate Detective we have helped a lot of doctors secure income protection cover, by finding the most price competitive product from our panel of 9 insurance companies. Generally speaking, there are certain features that doctors have requested to be included in their income protection policies over and above the standard type policies available in the market. The most common features requested are:
1) Needle stick benefit
2) Three Tiered Definition
3) Best of the last 3 years income come claim time
Many income protection policies do not come standard with these features and benefits although there are some in the market that have some of these features inbuilt. Often the extra cost to include these benefits is not that significant. Each benefit is described in more detail below.
Needle stick benefit for Doctors
If your policy has a needle stick benefit you can receive a lump sum benefit up to 50 times your monthly benefit (capped at 1 million) should you suffer Occupationally-Acquired HIV or Occupationally-Acquired Hepatitis B or C.
Most companies do not have this feature built in standard into their policies and it is either an optional extra or comes as part of a plus package. Each insurance company differs in their terms, so if you are interested in this feature speak to one of our advisers who can provide a quote including this option.
Three Tiered Definition
The three tiered definitions main benefit for doctors is that it includes an “hours” and “income” based definitions.
The “hours” based definition allows doctors to work up to 10 hours a week and still be entitled to claim the full monthly benefit on their income protection policy. Often if doctors are sick and injured and cannot work full time, they still need to work a few hours a week to tend to urgent patients etc. Without a 3 tiered definition, the monthly benefit could be significantly less.
The three tiered definition also includes an “income” based definition that enables you to earn some income and still receive a proportion of your monthly benefit (note if you are working under 10 hours you still receive the full monthly benefit). The formula varies from company to company, so be sure to ask one of our advisers for some examples on how this works.
Best of the last 3 years income
Many doctors are self-employed working on a contract basis. As such, income can fluctuate from year-to-year. If you are on an indemnity policy, come claim time you will need to prove your income in order to get paid your monthly benefit. Many companies will look at the earnings in just the most recent financial year. If your income fluctuations, this could leave you exposed. Some companies have a built in feature where they will take the best out of the last 3 years income for calculation purposes come claim time. Many doctors find this feature of income protection attractive.
Alternatively, some doctors elect for an agreed value policy that lets them lock in their monthly benefit at the time of application by having the insurance company verify income by taking the best out of the last 2 years financials.
How Income Protection Works
Income Protection will insure you for up to 75% of your income if you cannot work due to any accident injury or sickness. You need to select a waiting and a benefit period.
The Waiting Period is the amount of time from when you are not able to work till you can put in a claim. The most common options are 14 days, 30 days or 90 days.
The Benefit Period is how long you will be paid if unable to work due to illness or injury. E.g. an age 65 Benefit Period means you will be paid to age 65. The most common options are to age 65, 5 years or 2 years.
The cover is 24/7 worldwide. Premiums can generally be paid out of your superannuation or out of your disposable income. If paid from your disposable income, they are generally tax deductible at your marginal tax rate. If paid from Super there is generally an upfront 15% tax rebate available.
Free Income Protection Quote for Doctors
If you put in your details on the contact form on this page or call us on 1300 793 143 and we will organize you quotes from up to 9 Insurance companies in just a few minutes. If one of the features and benefits that we have pointed out is of interest to you, ask our advisers about it during the call.