Can I still get life insurance or income protection if I work in the mining industry?
Yes, insurers will assess occupations and actual roles on a case by case basis when reviewing policy applications. They look at all risk factors like occupational hazards, your current health, your medical history and your age. When they come across factors that raise your personal risk levels, insurers may raise premiums to compensate for this. These premium bumps are called loadings.
As a miner, occupational risks will most likely result in loadings when you take out a life insurance policy.
- If you work more than one job or have responsibilities that encompass more than one role, the most dangerous of these is used to determine your premium loading.
- Your premium is generally determined not by job title, but by what you actually do.
Here’s how one insurer classifies mining jobs
Below are details of how miners are classified by MLC Life Insurance
- Mining – clerical or executive manager: Low-risk “white-collar” job. No loading for occupation.
- Mining – explosives handler (surface and underground): Extremely high-risk “uninsurable” job. No cover available.
- Mining – surface or underground worker (no explosives): High “special risk” job. Loading for occupation. Applications must be considered on a case by case basis.
- Mining – qualified surface worker (no explosives): Rate for occupation such as electrician, plumber or heavy-equipment operator rather than miner.
This insurer has classified mining jobs based on whether they are clerical or physical, whether they involve explosives or not, and whether they are underground or above ground. These are what they believe to be the most relevant variables in deciding whether someone is likely to be injured or killed on the job someday.[/fin_must_read]
Expect insurers to ask about:
- What exactly your job requires you to do
- Whether you ever work underground or with explosives
- Your occupational experience, relevant licences and training
- How much you earn
- What your shift schedule is like
What risks does your job carry?
Consider the risk factors present in your job when thinking about life insurance policies. These can affect whether or whether you will need to find a specialist insurer or go through a life insurance broker.
- Working underground marks you as higher risk than above-ground workers. If your role requires you to go underground at all, even for short times, you should expect additional loadings.
- Working with explosives will greatly elevate your risk and raise your premiums.
- Electricians, train drivers, truck drivers, heavy equipment operators, carpenters, geologists, supervisors, surveyors and the many other jobs found on mining sites are typically considered as different occupations with their own risk factors. For example, electricians will pay loadings to offset the increased risk of electrocution while truck drivers may have a loading for their elevated chance of a vehicle accident.
If your role involves working underground or with explosives then you may wish to consider finding a specialist insurer or going through an insurance broker. If it involves both explosives and working underground then you may have no choice but to do so.
I have workers compensation. Do I really need income protection insurance?
Australian companies are required to provide workers compensation insurance to their employees, including miners. While this can offer effective benefits if you are injured on the job, it is much more limited than having income protection insurance in place.
The first problem is that workers compensation is very different in each state, and it can be difficult to know what benefits you may be entitled to in the event of a claim.
- Depending on which state you are working in at the time of an accident, where you are living and what your employer’s workers compensation arrangement are, you may be eligible for different benefits at different times.
- Some states offer lower benefits, have stricter injury, illness or disability requirements and shorter benefit periods than others.
- Depending on your location, employer and occupation, your workers compensation might be:
- managed entirely by the state government
- managed by approved private insurers that operate with state approval
- managed entirely as a private agreement between your employer and the insurance company
- handled entirely by your employer in line with state regulations and without an outside insurance company.
Income protection insurance can offer additional benefits:
- It will pay benefits for injury, illness, disability and death even if it occurred outside the workplace, or for reasons unrelated to your job. To get workers compensation you have to prove that the incident was a direct result of your employment.
- It can pay benefits beyond what workers compensation does. For example, an injury might leave you unable to work for a full month, but you are only able to claim two weeks of income protection. Income protection insurance will continue to pay for the duration of the benefit period provided you are still unable to work due to your injury.
- Benefits paid are typically larger, particularly in relatively high-earning areas of the mining industry. Each state has its own maximum limits for workers compensation benefits and these might simply be too low. For example, NSW limits its income protection benefits to a maximum of $2,100 per week which might not be enough for a full family, while Western Australia will only pay for up to $57,000 worth of medical costs unless you can prove extenuating financial circumstances.
- You also need to consider the increased costs associated with an illness or injury that may not be covered under your workers compensation policy, such as transportation, over-the-counter medications and caretakers. Once you factor these in it might become more apparent that you can benefit from additional coverage.
Both using a broker and finding your own cover are good options, but sometimes one will be more effective than the other.
- If you work underground, deal with explosives or otherwise have an elevated-risk mining job then an insurance broker may be more suitable for your needs. They know the market and which insurers offer good cover for risky jobs.
- Insurance brokers who specialise in cover for mining industry workers have the experience to find the most suitable policies.
- If you have a complex financial situation, pre-existing health conditions or other circumstances that might make comparing policies difficult, a broker can help you figure out how to accommodate these.
- If you’re unsure whether you want life cover, income protection, trauma insurance, TPD cover or any combination of these, an insurance broker can help you pick out the essentials.
- Many brokers work with multiple insurance companies. Sometimes your best option is to get separate life, TPD, income protection or trauma policies from different providers rather than as one package from the same insurer. Where this is the case an insurance broker can make it a lot easier.