Income Protection Quotes

When you start thinking about Income Protection there are many questions to ask yourself such as:

Do I really need Income Protection?
How much Income Protection do I need?
How much does it cost?
Do I need a medical?
Where do I get Income Protection quotes?
Which company do I apply through?
How do I know which quote to accept?

Let’s look in more detail at these questions.

Do I really need Income Protection?

If you rely on the income that you or your partner receive as a payment for work to live on, then YES you certainly do need income protection.

Income Protection is vital for all people who work, most of whom have family that depend on them as well.

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How much Income Protection do I need?

Income Protection pays up to 75% of you income if you are unable to work due to illness or accident.
There are features of income protection that you are able to select so that the policy is tailored to suit your needs. These are:

Waiting Period – how long you need to be off work before your policy starts to pay you a monthly benefit. You can select periods from 14 days up to 2 years. Most people choose 30 day wait.
Benefit Period – this is how long you will be paid. You can have periods from 2 years up to age 65. Most people go with age 65 – as this means if the illness or accident is so severe that they are never able to work again – they will continue to get paid up until retirement age.
Agreed Value or Indemnity – this is whether you prove your income at the start of the policy – so that what you are paid at claim time is “agreed” or indemnity which means working out what you will be paid based on what you actually earn at the time of claim. So if it is an indemnity policy you will receive the lesser of 75% of your income at the time of claim or the amount you are insured for.
Extended or Basic – this is whether you want a basic policy that just covers paying you your income or an extended which has all the frills – such as nursing care.

If you are not sure, you can use an online calculator to help you work out the best amount of cover for you. A good website with a great calculator is www.lifewise.org.au

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How much does it cost?

Income Protection is costed at an individual rate – it is not a “one size fits all” price. So the general things which effect the premium you pay include:

Your gender – Income Protection is generally more expensive for females (females live longer and claim more often on this style policy).
Your age – Income Protection generally costs more, the older you are.
Your occupation – every occupation has been rated for risk. There are over 3,000 different occupations and some such as a high rise window cleaner carry more risk than a receptionist.
Your smoking status – this is the major lifestyle factor that effects your premium. Smoking rates are usually about double non smoking rates. The good news is that once you have been a non smoker for over 12 months you can be re-classified as a non smoker and have the lower premium rate.
Premium rate – you have 2 options when paying premiums. Stepped or level premiums. Stepped is the cheapest at entry – as it is reviewed every year – so when you are older, you will pay a lot more. A “level” premium is where the rate is the same each year of the policy. It is basically paying the average premium every year – which will be more expensive at the start – but more affordable when you are older and more likely to claim.

There are other factors that also come into play at the “underwriting” stage such as:

Your health – you will answer a detailed set of questions about your health, both past and present. This goes into all aspects of your health, both physical and mental.
Your height and weight – more often, your Body Mass Index (BMI) is used as a tool to assess future health problems.
Your family history – there are a number of diseases which run in families that could impact on your long term health.
Your hobbies and past times – if you pursue dangerous sports such as hang gliding or parachuting this will lead to a higher premium, or an exclusion on that activity.

You have a legal obligation to be honest about your health and habits when applying for a policy. It is also good to be honest and accurate about your past health record and factors such as smoking or dangerous hobbies, rather than risking your policy being deemed invalid later on when you claim.

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Do I need a medical?

Generally no.

Every insurance company has standards based on age and sum insured that will necessitate mandatory medicals and blood tests. These limits are usually for amounts above $1 million and people over the age of 50.
As well as the mandatory rules, insurance companies may request a medical examination or blood test, based on the information you have disclosed in your application. For example if you state that you have had an abnormal pap smear, they will want to investigate details further, usually by writing to your doctor. This is the same for all serious medical conditions both present and past.

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Where do I get Income Protection quotes?

Good news – this is now made easy using the net!

Our experience with online Income Protection is that consumers are seeking real-time immediate information and premium calculations to enable them to make decisions on the spot.
Using our online Income Protection calculator you can:

Compare and access Australia’s lesading insurance companies policies
Access different types of personal insurance such as Income Protection, income protection and trauma insurance.
Have real time instant comparative quotes, rather than just providing your details to a sales person to follow-up
Gain independent comparative product research
Access relevant consumer documentation such as Product Disclosure Statements (PDS)
View the organisations credentials and qualifications

If you are surfing the web looking at other sites, make sure that you are purchasing comprehensive Income Protection. Some companies will advertise that you can apply online without the need for any medical history, usually this typically only covers you if you can’t work due to an accident. Major insurance companies will always want to know about your medical history prior to issuing a full insurance policy.

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Which company do I apply through?

There are a variety of insurance companies that operate in the Australian marketplace. While they might all offer Income Protection, the larger companies that have strong balance sheets are preferred, as you want peace of mind knowing that if you need to claim, they have the money to pay.

Using our site – we only deal with Australia’s major insurance companies. So if you stick within these 10 companies, you should have peace of mind that they are all quality insurers.

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How do I know which quote to accept?

Don’t just consider the cheapest quote. The larger, well known and reputable companies may offer something slightly dearer but it’s like anything – you get what you pay for. Their policy may cost a bit more, but may also offer greater benefits and coverage than cheaper lesser known companies.

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