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AIA Income Protection

AIA Life InsuranceAccidents and illnesses can happen to you at any time. If you were unable to work due to an illness or injury, could you afford to take time off work and keep up with the costs of living? Would you be able to pay the medical bills that accompany accidents and illnesses, or keep up with your children’s education? What about paying your rent or mortgage, and taking care of your family’s existing lifestyle?

AIA Australia’s Income Protection cover can help protect one of your most valuable assets – your ability to earn an income. If you’re too sick or injured to work for an extended period-of-time not covered by your sick leave, Income Protection can replace part or all of your income depending upon the level of cover you choose.

How does it work?

Whereas as AIA Australia’s Total and Permanent Disablement Cover and Crisis Recovery cover provide a lump sum payment to after your claim, AIA Australia’s Income Protection can provide a monthly reimbursement that’s designed to replace your income should you become unable to work.

When you apply for Income Protection, you choose the level of cover you want to receive and the benefit amount you want to be covered for. You can either base your cover on your current monthly income (Agreed Value benefit), or get covered for 75% of your income (Indemnity benefit). The maximum monthly benefit you can insure yourself for is $60,000, but different occupational categories have different capped benefits.

Is there a waiting period to receive my benefit?

There are different waiting periods depending on the level of cover you apply for and your occupational category. These waiting periods can be anywhere between 14 days or 2 years Generally, the longer the waiting period, the lesser the premium paid.

You can also choose the benefit period – the period during which you’re eligible to receive a benefit. This can range from 2 years to 5 years, or up to age 65.

What kind of cover can I choose from?

AIA Australia lets you choose from five different levels of Income Protection, so you can decide which level is most beneficial to you depending upon your lifestyle, age and occupation.

  • Income Protection
    This level of cover provides a monthly replacement income if you are unable to work due to an illness or injury. Both full-time and permanent part-time employees are eligible to apply, including those who are self-employed on a full-time basis.
  • Income Protection with PLUS Optional
    Includes the full range of built-in benefits, plus additional benefits such as a crisis recovery benefit, a family care benefit, a home benefit, an accommodation benefit, a bed confinement benefit, and guaranteed insurability.
  • Income Protection with Advantage Optional
    Includes the full range of built-in benefits, plus additional benefits such as an elective surgery benefit, a specified injury benefit, and can also be paired with PLUS Optional for a more comprehensive level of income protection.
  • Income Protection Accident Only
    Provides cover if you become disabled as a result of an accident, such as a car crash. This level is also available to full-time and permanent part-time workers. Those who are self-employed can also apply for this cover if they are working on a full-time basis.
  • Income Protection Essentials
    Provides a basic level of protection for those not working full-time. Ideal for those working part-time or on a casual basis, such as stay-at-home parents.

If you run your own business full-time and want to make sure your fixed expenses are protected, you can also choose to receive the Business Expenses benefit at an extra cost. This benefit is ideal for self-employed practitioners, business partnerships, or those who are directors of a business.

What’s included?

Along with your benefit amount decided by you (either Agreed Value or Indemnity), you’ll also get the following benefits under Income Protection:

  • Benefit Indexation
    It’s important that your cover retains its value over the years, so on each cover anniversary AIA Australia will increase your sum insured to stay in line with the Consumer Price Index (CPI).
  • Total Disablement benefit
    If you are disabled (totally or partially) past your selected waiting period, AIA Australia will pay you an Insured Monthly Benefit in respect of your Income Protection benefit. You’ll receive this from the end of your waiting period up until the end of your benefit period, as long you’re still disabled. Another advantage is the premium waiver benefit. AIA will waive the monthly premium whilst you are on claim.  If you claim a total or partial disablement benefit after your waiting period, AIA Australia will reimburse any payments you made during the waiting period.
  • Rehabilitation expenses
    AIA Australia will reimburse you to cover the costs of an approved rehabilitation program.
  • Claim your benefit more than once
    If you’ve returned to work full-time after receiving a benefit, and that same illness or injury occurs again within 12 months, AIA Australia will waive the waiting period and treat your aim as a continuation of your initial claim.
  • Severity benefit
    If you’re illness or injury is so severe that are unable to perform some of your day-to-day duties, and you’ve been on your benefit for more than 6 consecutive months, AIA Australia will pay you an extra 1/3 of your monthly insured benefit, up to a maximum of $30,000 until the end of the benefit period.

Want to compare this policy with others? You can compare AIA Australia Income Protection with other insurance providers through our free quote service.

Page last updated: April 13, 2014