A Guide to Income Protection Insurance Quote Comparison

By comparing income protection quotes, you can dive deep into the policy you’re considering. You’ll be able to scrutinize its coverage, premium types, waiting periods, benefit periods, and additional options with ease. Don’t settle for less, make an informed decision today.

Published March 18, 2024

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Understanding Income Protection Insurance

Income protection insurance is a valuable form of coverage that provides financial stability and income certainty if you cannot work due to illness or injury for longer than your waiting period. Its purpose is to protect your financial future by offering a regular monthly payment, typically up to 70% of your monthly salary, for a specific period as determined in your Policy Disclosure Statement (PDS).

What does income protection cover?

Income protection insurance generally covers you if you experience an illness or an accident that leaves you unable to work in your occupation or any occupation longer than the waiting period specified in your policy. Therefore, it is essential to carefully review and compare different insurance providers and their specific offerings to find a policy that aligns with your requirements and preferences.

Factors to Consider When Comparing Quotes

When comparing quotes for income protection insurance, there are several key factors to consider. These factors will help you determine the suitability of a policy for your needs:

Premium Types to Compare

In addition to coverage considerations, it’s essential to compare different premium types insurers offer. Premiums are the payments you make to maintain your income protection insurance policy. Here are two common premium types to consider:

Additional Paid Add Benefits

Income protection benefits are an essential safety net for individuals who may be unable to work due to illness or injury. These paid options provide you with a way to further customise your policy to  provide additional financial support to help cover living expenses while you’re unable to earn an income. 

Short Waiting Period for Accidental Injury and Critical Illness Option

The Short Waiting Period is a feature of certain income protection policies (generally where 14 or 30-day Waiting Periods apply) that allows you to receive benefits during the Waiting Period if you are Totally Disabled for at least three consecutive days due to either:

Typically, the insurer will pay 1/30th of the Monthly Benefit amount for each day of Total Disability during the Waiting Period, starting from the first day of your Total Disability and continuing until the earlier of:

Take note: It’s important to refer to the covered Critical Illness Conditions definitions in your PDS. Certain exclusions apply during the initial 3 months of the insurance, and conditions must meet the definition as diagnosed by a Specialist and confirmed by a medical adviser appointed by your insurer.

Indexed Claim Benefit

To ensure that benefits maintain their value in the face of inflation, your Monthly Benefit and Earnings Before Disability will receive an annual increase, not surpassing the Maximum Income Protection Benefit.  The annual percentage change in CPI determines the adjustments in CPI. 

In cases where there is no increase in the consumer price index (CPI), the insurer typically would increase by a set % of between 3-5% to the benefit amount. This option ensures that the insured’s claim payments are potentially adjusted to account for fluctuations in the cost of living over time. 

Super Guarantee Benefit Option

The Super Guarantee Benefit Option provides an additional benefit if you are eligible for Total Disability Benefit or Partial Disability Benefit and continue  contributions to your superannuation (super)  on your behalf. This benefit is paid directly into your nominated super fund.

The amount of the Super Guarantee Benefit is typically calculated by taking the lesser of two factors. Firstly, it is based on the Super Guarantee Benefit amount specified in your Policy Schedule. Secondly, it is determined by considering the average amount of super guarantee payments made to your fund over the 12 months prior to the onset of Disability, or during any other relevant period mentioned in the table below.

SituationPeriod that applies
More than a 10% decrease in super guarantee payments compared to the previous 12 months24 months prior to Disability
Worked more than 3 consecutive months but less than 12 months prior to DisabilityMonths actually worked in the 12 months prior to Disability
On unpaid employer-approved maternity leave, paternity leave, sabbatical, or study leave during the 12 months before Disability12 months prior to starting leave

If you select the Super Guarantee Benefit Option and you are eligible to have contributions to super made on your behalf while receiving either a Total Disability Benefit or a Partial Disability Benefit, your insurer will typically pay a Super Guarantee Benefit into your nominated super fund. This benefit is paid in addition to the monthly disability benefit, but the combined Disability Benefit and Super Guarantee Benefit cannot typically exceed $30,000 / month.

Booster Option

If you choose to include the Booster Option in your policy and experience Total Disability or Partial Disability you may be eligible to receive the Booster Benefit, for a period of up to 6 months.

Calculating Your Booster Benefit

If you have opted for the Booster Option, the following adjustments will be made:

Unique Built-in Benefits

Regarding income protection policies, different insurers offer a range of unique built-in benefits that can add value to your coverage. These benefits are designed to provide additional protection and peace of mind.

How to Compare Income Protection Quotes Online

Step 1: Provide the necessary information

You’ll need to provide some essential information to insurance providers to compare income protection quotes. Your age and gender are important factors that insurers consider when calculating premiums and assessing risk. You’ll also need to specify your state of residence, smoking status, desired cover amount, and occupation. These details help insurers determine the appropriate coverage options and premiums based on your circumstances.

Step 2: Compare the pricing of various income protection policies

Once you’ve provided the necessary information, it’s time to compare the pricing of different income protection policies. Obtain quotes from multiple insurers and carefully review the cost breakdowns for each policy. Pay attention to the premium amounts and any additional fees or charges associated with the coverage.

Consider your budget and financial capabilities when evaluating the pricing of each policy. Remember, the cheapest option may not always provide the comprehensive coverage you need, so balance affordability and adequate protection.

Step 3: Compare the features and benefits of various income protection policies

In addition to pricing, comparing the features and benefits of different income protection policies is crucial. Look beyond the cost and consider the following aspects:

Step 4: Look at Waiting periods and benefit periods

Compare the waiting periods (the time before you become eligible for benefits) and benefit periods (the duration of benefit payments) offered by each policy. Consider your financial stability and ability to withstand a waiting period when deciding.

Step 5: Review Exclusions and Limitations

Carefully review the policy’s exclusions and limitations to understand what circumstances may not be covered. Be aware of any pre-existing conditions or specific occupational exclusions that may affect your eligibility for benefits.

We make it easy for you to compare policies online with our powerful comparison engine.

Buy with confidence today for peace of mind tomorrow.

Other Ways to Protect Your Income

In addition to income protection insurance, there are other avenues you can explore to safeguard your income. These alternatives can provide additional layers of financial protection in case of unexpected events. Here are two options worth considering, typically not as comprehensive but worth considering if income protection is not available or doesn’t meet your requirements:

Group Salary Continuance

Many employers offer group salary continuance as part of their employee benefits package. This coverage provides a regular income stream if you cannot work due to illness or injury. Group salary continuance typically covers a portion of your salary for a predetermined period, offering some income security during your absence from work.

Personal Accident Insurance

Personal accident insurance is a type of coverage specifically designed to protect individuals in specific industries or occupations against accidents and their potential impact on your income. It provides financial support for accidental injuries, offering compensation for medical expenses, disability, or loss of income resulting from an accident.

Benefits of Using an Online Quote Tool

An online quote tool for comparing income protection insurance quotes offers numerous advantages. Here are some benefits you can enjoy:

Frequently Asked Questions and Answers

  • Who should consider getting income protection insurance?

    Income protection insurance benefits anyone who relies on their income to cover living expenses. It is particularly important for individuals with financial dependents or limited savings to sustain themselves in the event of a loss of income due to illness or injury. This includes both employed individuals and self-employed individuals.
  • What are the key factors to consider when comparing income protection insurance quotes?

    When comparing income protection insurance quotes, it’s important to consider the monthly benefit amount, benefit period, waiting period, coverage options, premium type, policy exclusions, and any additional benefits or riders offered. You should also evaluate the insurer’s reputation, financial stability, and customer reviews.
  • How can I find the best income protection insurance providers in Australia?

    To find Australia’s best income protection insurance providers, you can start by researching and comparing different insurers. Look for insurers with a strong reputation, positive customer reviews, and a track record of financial stability. You can also seek recommendations from friends, family, or financial advisors. Additionally, online insurance comparison platforms and websites can provide you with a list of reputable insurers to consider.
  • What should I look for in an income protection insurance policy?

    When evaluating an income protection insurance policy, consider coverage options, waiting period, benefit period, exclusions and limitations, premiums, and additional benefits. Ensure the policy aligns with your occupation and personal circumstances and provides adequate coverage for your income protection needs.
  • Can I modify my income protection insurance policy as my circumstances change?

    Many income protection insurance policies offer flexibility to modify your coverage as your circumstances change. You may be able to adjust your benefit amount, waiting period, and benefit period to better suit your needs. However, it’s important to review the terms and conditions of your policy and consult with your insurance provider to understand the specific options and requirements for modifying your income protection insurance policy.

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