Waiting period and benefit period: what’s the difference?
11 October 2021
As you consider income protection cover, you’ll come across terms like ‘waiting period’ and ‘benefit period’. Many people think they are one and the same. But they are not. It’s important to understand what these two concepts are, how they differ, and the role they play when you take out income protection insurance.
What is a waiting period?
The time that elapses from when you’re seriously ill or injured to when you’re eligible to file a claim is called the waiting period. That is, you need to wait for a certain amount of time before you can start receiving your benefit.
If, during this waiting period, you’re able to get back to work, then typically, you won’t receive your benefit payments.
Insurers may offer flexible waiting periods where you have the power to decide how long you want to wait before payments kick in. With Suncorp Income Protection Insurance, you get the flexibility of choosing from 14, 28, 60 or 90-day waiting period. Weigh up the options against your circumstances to decide what waiting period is right for you. If you feel confident about having savings set aside to tide you over temporarily, a longer waiting period might be your choice. Choosing a longer waiting period also may lower your premiums. But at the same time, if you don’t have a financial buffer then you will have to wait for a longer period of time before your replacement income comes in.
What is a benefit period?
The duration for which you will keep on receiving your benefit payments is called the benefit period. Let’s say, you choose a six-month benefit period. Then your payments will continue for six months or until you’re fully recovered and are back at work, whichever happens first.
Impact on your cover
As we’ve seen, waiting period and benefit period are two distinct concepts. And both of them play a significant role when it comes to how your income protection cover operates. While insurers might provide flexibility when choosing waiting and benefit periods, which can determine how high or low your premiums might be, you need to weigh up what is the optimal balance between the two that’s right for your needs. One that will be affordable for you and offer the level of financial assistance you require while you focus on your recovery.
If you need assistance, you can also get in touch with the Suncorp Life team today on 13 11 55.
- How income protection can help you and your family in tough times
- Compare income protection policies
- When is the best time to get income protection?
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