Disability cover Pays benefits to a person who is so disabled by illness or injury that he is no longer able to work in an income. Payment may be either in the form of a lump sum (sometimes called a capital disability benefit) or a monthly income benefit, depending on the provisions of the policy contract.

Benefits may be for temporary or for permanent disability as defined in the policy contract.

There are three basic forms of disability cover available:

1. Occupational disability
2. Functional disability
3. Physical disability

Occupational disability:

There are two main types of disability benefits that for under occupational disability. They are as follows:

1. The monthly income protection policy also known as a income protector.
2. Capital disability benefit.

Features of a monthly income protection disability benefits:

• Cover is in the form of a monthly benefit
• Income disability benefits of available as stand-alone benefits
• Benefits are payable in the event of total, partial or temporary disablement.
• A choice of waiting periods is available (depending on the insurer and your occupation) and these can range from seven days to two years, but one- and three-month waiting periods are the most common used.
• The term and level of disability cover is determined at inception of the policy and benefits must relate to your earnings.
• You have a choice of level or escalating premium pattern. Note level premium pattern more costly than escalating premium pattern.
• annual increases in the benefit amount may be selected so that once a person who is receiving the disability benefit it remains in line with inflation.

Benefits of an income protector:

• provides a monthly income of the insured event occurs within a specified term
• Benefits are a payable in the event of total, partial or temporary disablement.
• The payment will commence once the waiting period has expired.
• If the policy has an escalator, disability benefits levels will increase each year.

Features of lump sum/capital disability benefits:

• Cover amount will be payable on the disablement of the client in terms of the relevant requirements of the product provider concerned.
• Lump sum disability benefits are usually available as stand-alone benefits or as accelerators to a standalone life cover benefit.
• The level of life cover is determined at inception of the policy.
• You have a choice of cover premium patterns which can be either level or escalate. Note level premium pattern more costly than escalating premium pattern.
• Premiums can be paid monthly or annually.

Benefits of a lump sum / capital disability

• Cover is in the form of a lump sum.
• Benefits of pale but only in the event of total and permanent disablement.
• Benefits are often attached to a life cover policy.

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