What is exclusion?
Like any other type of insurance product, the income protection insurance policy also has some specific areas of exclusion. It is therefore important for the policyholder to be aware of conditions or events that are not covered by the income protection policy and others that may under some circumstances not be covered.
What is excluded?
Basically, three standard income protection insurance policies exclusions exist:
- No policy will provide payouts if it is confirmed that the policy holder attempted to commit suicide or intentionally inflicted herself/himself/herself, resulting in the disability. This exclusion clearly provides protection to the insurance providers against policyholders who will or may incur disability intentionally just to receive the insurance monetary payouts.
- Income protection insurance will not cover injuries or disabilities arising out of any war or what are referred to as acts of war. This protects insuring companies against situations which are potentially volatile and which they can have nothing about in terms of protecting their businesses.
- Income protection policies do not cover childbirth or pregnancy which are medically uncomplicated even if disability of a temporary nature arose thereof of less than three months. Insuring companies insist that there exists other kinds of insurance, employment perks, social security arrangements that could very well cover such situations and provide financial assistance to mothers who are on maternity leave.
Any elective surgery disability may be covered but may be categorized as being temporary or partial disability. Payouts may be provided for a few months only or until some recovery is attained.
Of course there are other forms of exclusions that insurance companies can include in their policies. However, those providers and policies that have other additional exclusions besides the three above should be viewed as less favorable. It is therefore crucial that the holder understands all the provisions contained therein especially as regards exclusions.
Your claim is not being approved?
Every insurance provider may have a different set of exclusions, but certain basic exclusions are common in majority of policies. Most policies maintain a qualifying period during which can not make a claim. If you claimed benefits during this specific qualifying period your claim will not be approved.
It is worth noting that your income protection policy is not able to cover both injury/illness and job loss/redundancy
You are unlikely to get coverage for pre-existing medical conditions that lead to you not being able to work for long periods. You need to declare to the insurer any such conditions when applying for the policy. The insurer may cover you, if you can satisfy them that you did not experience problems with this during a specific period before it again flared up. If the provider can prove that you knew about the medical condition but did not disclose, you may get excluded.
If you are unable to perform your work due to injuries or illnesses that are self inflicted, you are not likely to benefit from your income protection insurance cover. Attempted suicide falls under this category.
Some specific minor conditions like backache may not be covered unless they are specific condition on their own or can be linked to a specific condition.
Many if not all policies insist that for you to benefit, you must have been in some form of continuous working engagement or employment for a specific duration before you were declared redundant or lost your employment.
If you lost your job because of your own mistake or fault, your claim may not get approved. Examples include misconduct or willful neglect. The job loss must not have been of your own making.
Exclusion will also come into force if you take redundancy voluntarily or you resign you’re your job.
To ensure that the exclusions coming with your policy are fair and do not make it impossible for you to make a claim, be sure to thoroughly read and understand each exclusion clause in your policy document and ask for clarifications where not sure. After you have signed the documents, it may be too late. Take your time and do your research about available policies, understand them and their exclusion clauses before settling on your final choice. They may not all fit your bill but you will at least be making an informed decision.