Can I get income protection insurance if I am 60 and over?
Yes you can. The maximum entry age for Income Protection Insurance for most Australian insurers is 60 with some insurers offering cover for applicants up to age 64. Generally:
- Maximum entry age is usually 64 (Age of next birthday)
- Cover usually expires at 70
Continue reading our guide for more information. Alternatively, if you're ready:
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Is there an age limit for Income Protection?
|Provider||Age of entry||Conditions|
|Asteron||62||When on a stepped premium|
|ClearView||60||When on a hybrid premium|
|Comminsure||54||When on a level premium|
|Macquarie (Zurich)||64||On disability income insurance policy where the policy ends at the age of 70|
|TAL||59||Certain occupations are limited to the age of 54|
Can my age limit be extended if I bought my policy before 64?
Some policies will offer an extension of the benefit period for policy owners that are above the age of 65. As an example, AIA offer a 2 Year Benefit Period to age 70 with the following conditions:
- Policy owners must be between 61 and 65 years of age at their next birthday in order to be eligible for this benefit.
- Maximum benefit payment of $20,000 applies.
- Only available with a stepped premium structure. Premiums are not available as level or optimum.
- Other benefits received under government age pension will be offset against benefit payable.
- Expiry date is the policy anniversary prior to the policyholders 70th birthday. Any claim that has been made will be end at this date.
Do I still need to consider income protection in my 60s?
Statistics show that Australians are no longer intending to retire in their early 60's. A 2015 survey by the Australian Bureau of Statistics (ABS)
- 71% of Australians intend to retire at 65 years or over
- A quarter of males intend to work over the age of 70
Risks at the age of 60
People that are still working in their 60s are generally at a critical point in their lives when they are looking to prepare for their retirement years and accumulate savings to let them live comfortably when they stop working. Generally speaking, people in this age bracket are not in the same health that they were in their 20s and can be more susceptible to having to take extended periods off work to recover from illness or injury. This is why insurance premiums increase with age, as people in this age group are statistically more likely to make a claim on their policy.
The last thing you want in your 60s is to have to dip into hard earned savings to keep on top of any outstanding debts and daily living expenses. Income protection will ensure that if you are forced to take time off work, a steady flow of income will keep the essentials covered and let you focus on your recovery.
I am not as active as I was, surely I won't get injured?
Just because you are not as active as you once were is no reason to feel the chances of you being injured are slim. Many of the most common causes of people being forced out of work are from accidents that happen at home and not on the playing field. What's more, income protection also provides protection for any serious illnesses you may suffer.
What's the benefit of having income cover in your 60s?
- Cover against risks: Life today is full of uncertainties; in this scenario Life Insurance ensures that your loved ones continue to enjoy a good quality of life against any unforeseen event.
- Protection against rising health expenses: Insurance plans offer the benefits of protection against critical diseases and the ever-increasing hospitalisation expenses.
- Reliable source of income during retirement: Insurance is one of the best instruments for retirement planning. The money you save through it can provide a steady source of income during your retirement.
- Tax concessions: Insurance plans provide attractive tax-benefits during the time of entry and exit under most of the plans.
- Helps pay mortgages: Insurance also acts as a tool to cover mortgages and loans taken by the policyholders so that, in case of any unforeseen event, the burden of repayment does not fall on surviving family members.
What does income protection provide?
Income protection provides cover for up to 75% of your regular income (some policies will cover up to 100% if the remainder is contributed to super) in the event that you are forced to take time out of work as a result of serious injury or medical condition. Policies can be tailored to include a whole range of features to give you the right support during your recovery including cover for rehabilitation expenses, nursing care and bed confinement benefit to name a few.
What to look for when comparing income protection policies if your over 60
- Benefit period: Income protection pays you a benefit up to 75% of your gross monthly income. The length of cover may vary between each provider but there are income protection policies which, extend cover to age 65. Thus, even if you are 60 years old, there is still something for you.
- Premium waiver: Aside from this, income protection has a waiver of premiums feature which lets you waive the premiums when you are receiving the pay-out. This feature allows you to retain the policy without paying the premiums.
- Guaranteed insurability: When looking for income protection at around 60 years of age, be sure to opt for a non-cancellable contract. This may cost a little more but a non-cancellable contract protects your policy from being cancelled when the risks you are involved in becomes higher, such as your health deteriorating. Moreover, a non-cancellable contract also lets you renew your contract even after making a claim.
- Waiting period: Another thing that you should be looking for is the length of the waiting period. How long are you willing to wait before you can cash in your claim? Income protection has flexible waiting periods you can choose from between 14 days to 24 months. There are also some policies which, offer a no waiting period feature in their policy. However, these policies with no or short waiting periods, have higher premiums than those with longer waiting periods.
- Rehabilitation expenses benefit: One more additional feature that is beneficial for you at 60 years of age is the rehabilitation expenses benefit. Again some policies have it and some don’t. The rehabilitation benefits pay you an additional amount to help with rehabilitation costs. Other income protection policies also have added medical and surgical expenses benefits. The best way to find out if these add-ons are available is to compare various income protection policies from different insurance providers.