Income protection insurance
Provides a regular income if you temporarily can’t work because of sickness or injury.
The benefit is paid on an ongoing basis, not as a lump sum, and is taxed as normal income. This type of insurance helps you continue paying your rent or mortgage, bills and covers the cost of running your car plus other daily living expenses.
Who needs income protection insurance?
This insurance is important for anyone who doesn’t have a lot of savings to draw on in emergencies or for people who’d prefer not to use the savings they do have. Even if you’re single and don’t have debt, you still need to eat and pay bills and rent.
Unlike workers compensation, which only covers you if you become injured or ill during work, income protection insurance covers you 24 hours a day, seven days a week and offers worldwide cover. You may also find workers compensation payments aren’t enough to cover all your expenses.
Eligible employer-sponsored members automatically receive this insurance upon joining. If you don't want this insurance and cancel it within 90 days of it starting, we'll re credit your account with the cost of this insurance. However, if you cancel it and decide later to take it, you won't be covered for any existing sicknesses you have when you apply. You're never covered for existing injuries.
If you’re not eligible for automatic cover, you can apply for Income Protection insurance at any time.
Did you know…
How much are you covered for?
Our Income Protection insurance covers you for 75% of the salary you earned in the 12 months prior to becoming disabled plus 9.5% of this salary as a super contribution to your Mine Wealth + Wellbeing Super account. If you're working but can't do all of your normal role, you'll be covered for the difference between what you're getting paid and 75% of your current salary.
There is a maximum amount you can be insured for. People working in mining, heavy manual or light manual occupations can have insurance to a maximum of $11,538.46 per fortnight, while those working in white collar and professional occupations can have insurance to a maximum of $18,461.54 per fortnight.
Tailoring your Income Protection insurance
There are some features of your Income Protection insurance you can tailor to suit your needs. These changes will affect the premium you pay for your insurance.
How much you’re covered for
You can insure for 75% of your nominated salary, excluding super, plus a 9.5% super contribution to your super account. You can insure for a lower salary than your actual salary to reduce your premium costs.
Your waiting period
This is the length of time from when you stop work to when the insurance policy starts paying you an income. You can change the standard 60 day waiting period to 30, 90 or 120 days. Generally, the longer the waiting period, the cheaper the insurance policy will be, but you need to ensure you’ll have enough money to cover you while you’re waiting. Your sick leave and any accrued annual leave you may have with your employer can cover this gap.
Tip: You can increase your waiting period to two years under our Policy Extension Option. This feature allows you to run two separate income protection policies one after the other. If you want to utilise this feature you need to tell us within 90 days of the date of your welcome letter or when you claim on your policy. Note that your premiums won’t reduce if you select this feature.
Your benefit payment period
This is how long the insured amount is paid to you if you can’t work. We offer a standard two year benefit payment period, which can be increased to five years. Increasing your benefit payment period will also increase the cost of your Income Protection insurance.
Tip: If you choose a 30 day waiting period or a five year benefit payment period within 60 days of joining Mine Wealth + Wellbeing, you’ll be covered for pre-existing sicknesses and the 20% smoker loading won’t apply.
How much does Income Protection insurance cost?
Your premium costs depend on your salary, age, gender and job classification. Premiums are generally more expensive the older you are, if you smoke, have a history of illness or work in a dangerous job.
It's important to tell us your job classification
It’s important to tell us your salary
The salary we record for you is used to calculate how much Income Protection cover you have and how much your premiums cost. If we don’t know your salary, we use a salary of $80,000 pa, not including super, to work out your Income Protection cover. If your actual salary is:
less than what we’ve recorded, you’ll only be covered for the lesser salary and will pay more for cover that you won’t be entitled to claim for
more than what we’ve recorded, you may not have enough cover for your needs.
Did you know…
If you hold your Income Protection insurance outside of super, the premiums you pay are fully tax deductible. Although premiums aren’t tax deductible if you’re insured through your super fund, you benefit from a lower tax environment, where super contributions are only taxed at 15% rather than your personal tax rate. Which is better depends on your personal circumstances.
Mine Wealth + Wellbeing Financial Advice can help you decide. Give them a call on 13 MINE (13 64 63).