How much does an income protection claim pay out?

Typically, income protection insurance provides you with a monthly income stream of up to 75% of your original salary. The amount you receive will depend on whether you are deemed totally or partially disabled (partial disablement may only pay a portion of your monthly income) and whether your policy is an indemnity or agreed value policy .

How do I claim income protection on tax?

Income protection payments are taxed as if they were normal income. When you lodge your claim, you will be asked to provide your tax file number so your income protection payments can be taxed on a pay as you go (PAYG) basis. If you don't provide your tax file number, your insurer will be required by law to withhold tax from your benefit payments at the highest marginal tax rate, rather than at the lower personal tax rate. However, if you held a policy outside of superannuation, your premium payments are tax deductible , so you can claim a portion of what you've paid back when you submit your tax return.

Can you still receive WorkCover payments or Centrelink benefits?

Yes, but the monthly benefit you receive from your income protection claim will be reduced accordingly if you're also receiving WorkCover or Centrelink benefits because of the injury or illness.

How long does an income protection claim take?

It typically takes 2 weeks to 3 months for an income protection claim to begin paying you. The length of time depends on the waiting period you select when you take out a policy and whether or not your insurer requires more information before it accepts your claim.

When can't you make an income protection claim

You can't make an income protection claim if you're let go from your job, terminated or made redundant. Income protection is only designed to assist you when an illness or injury prevents you from doing your job.