If you suffer from a pre-existing condition, it's still possible to take out income protection. Each insurer will have its own rules about which conditions it will and won't cover, so if your application gets knocked back by one, it doesn't necessarily mean you can't get covered by another provider.
You can do this either with an adviser or directly with the insurer, depending on how you choose to take out cover.
If an insurer accepts your application for income protection, you may pay higher premiums due to the increased risk that you are exposing them to. This added risk may result in you having to serve a longer waiting period, such as 60 or 90 days. Or, your insurer may impose exclusions on your policy (when claims arise from your pre-existing conditions).
Try another income protection brand if you don't succeed with your first application.
Make sure you understand what happens when you make a claim relating to your pre-existing condition. We explain this below.
Yes, you can get income protection if you have a pre-existing condition. In most cases, you will have to do one of the following:
Some income protection insurance providers will cover you for the pre-existing condition but there will be a loading – this is an increase to the cost of your premiums.
In some cases, if you have a more serious pre-existing condition, such as lung cancer, the insurer might cover you but not for any claims related to your pre-existing condition.
While the definition of a pre-existing condition can vary, it generally refers to the following:
"There are many things that could knock you out of the workplace for a time, so insurance companies will be very cautious to offer income protection insurance to anyone with a difficult medical background.
If you could imagine the types of things that would stop you from working for 6-12 months – a car accident, a fall on the sports field, chronic fatigue, glandular fever, long COVID, the list goes on. This is especially difficult for those that have a history of mental health issues – even minor."
"The silver lining with income protection and pre-existing medical conditions is that the insurer is more likely to exclude a medical condition rather than flat out refuse to insure you. This means while you're not covered for your particular ailment, you're still covered for all other events and illnesses."
Brenton Tong is the managing director and senior financial adviser at Financial Spectrum.
Examples of pre-existing medical conditions include the following:
To ensure that your income protection policy is tailored specifically to your needs and condition should they provide you with cover, you need to be upfront and honest about any pre-existing conditions you may have. If you withhold information from your insurance provider, it has the right to deny any claim that may arise as a result of your condition and refuse to provide cover.
With so many different income protection policies available in the Australian market, it isn't easy to determine which cover is most suitable for your needs. If you have a pre-existing condition, you should do the following:
You will be required to complete a health check-up with most providers when you apply for income protection. This is to enable your insurance provider to obtain a more accurate depiction of your health and the level of risk that it is exposed to should it provide you with cover. This is standard procedure and isn't something to be feared.
An example of how a doctor works with an income protection insurer
Let's say I see an applicant with high blood pressure. If the patient's blood pressure isn't well controlled after multiple measurements and they've advised me about the medicine they are prescribed for this medical condition, I would recommend a review of their blood pressure management including their medication. It may be as simple as a patient going to see their GP to have their blood pressure reviewed. If the patient's blood pressure readings are within the normal range, or they normalise after a revision to the dose of their medication, the insurance company may proceed with the policy... but if a person has a past history of a diagnosis, such as cancer, that's an example of where the insurer may request more specific detail.— Dr Deepak Gaur, the Founder of Pop Up GP, speaking to Finder about insurance medical assessments based on his experience.Read more here.
If you are looking to secure an income protection policy with no medical, you may want to consider the following alternatives:
Direct life insurance providers in Australia, such as Noble Oak and Zurich, offer income protection policies with competitive premiums with minimal medical underwriting. Even though you still have to go through a medical exam and complete a health questionnaire, there are generally fewer restrictions on the eligibility criteria with direct income protection application.
You can obtain income protection, also known as salary continuance insurance, through your super fund.
You may also already have cover in place through your employer's nominated super fund, so it is best to clarify if this is the case.
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