Other Income protection deducting illness benefit while not receiving illness benefit

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sparky1974

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I’ve been in receipt of illness benefit for almost two years and returning to work on a staged basis over the next 4 months. My income protection policy is through my employer. For my staged return to work I’ll be paid by my employer for hours worked and have income protection for the remaining hours. However illness benefit will be deducted from my income protection even though I can’t claim it while back to work. Is this standard?
 
Are you planning on returning to work full time?

If not (due to medical conditions) but can work part time, apply for partial capacity benefit - you might be eligible
 
sparky1974 said:
I’ve been in receipt of illness benefit for almost two years and returning to work on a staged basis over the next 4 months. My income protection policy is through my employer. For my staged return to work I’ll be paid by my employer for hours worked and have income protection for the remaining hours. However illness benefit will be deducted from my income protection even though I can’t claim it while back to work. Is this standard
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If you look at the policy disclosure document you would have gotten when purchasing , it will show how much is insured

Most insurers allow you to cover up to 75% of your pre-tax earnings, minus state illness benefit if applicable

I rang and took out "" 75% "" on mine but the *assumption* is welfare will make up some of that amount

When I look at the actual insurance documents, the amount officially insured is not 75% in my case but was around 55% therefore regardless of DSP allowing or not the illness benefit , you'll need to check the € for disability income protection insured amount on the policy

Nowhere is 75% mentioned


Which is an eye opener , because if I was in your position and said" hey Aviva. DSP declined my claim for illness benefit, no doubt they will say that doesn't matter to us because you insure the € amount you have with Us it still cost the 77 a month"

It's like the system is too halves ,

it's marketed like it's 75% made up of DSP (on the assumption of their approval) and insurance payouts (which it is normally for PAYE workers for example)

But if DSP decline the claim for illness benefit, then the insured company are still covered because they will say well that's nothing to do with us because we are only covering X amount insured
 
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sparky1974 said:
However illness benefit will be deducted from my income protection even though I can’t claim it while back to work. Is this standard?
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You should check the policy handbook but this was certainly the case with such employer policies with Irish Lfe many years ago. The policy paid out a percentage of salary but offset the illness benefit "payable to a single adult". It was irrelevant what the actual amount paid was.
 
thecoffeepod said:
I rang and took out "" 75% "" on mine but the *assumption* is welfare will make up some of that amount

When I look at the actual insurance documents, the amount officially insured is not 75% in my case but was around 55%
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What exactly did your policy state regarding the level of payment guaranteed? Surely it mentioned a specific amount or percentage of earnings even if that was reduced by the relevant social welfare payment?
 
Is the state illness payment worth 20% of your pre-tax earnings, such that 75% - DSP = 55%?
 
ClubMan said:
What exactly did your policy state regarding the level of payment guaranteed? Surely it mentioned a specific amount or percentage of earnings even if that was reduced by the relevant social welfare payment?
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Yes, 36k was insured on their policy
 
ClubMan said:
So why were you expecting any mention of 75%?
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What???I wasn't,

its 75% overall with illness benefit, thats how it is when you take it out

eg

from aviva "Choose how much of your income you want toprotectYou can cover up to 75% of your earnings (excluding Benefit In Kind) less StateIllness Benefit up to an overall maximum of €262,500 a year/€5,048 a week"

eg

you say I earn X eg 100k
I want to cover Y % eg 75% 75000
if paye worker then they auto take the illness benefit off the amount and insure for the balance 75kless illness benefit (15k for round figure) , and insurance company will provide a policy with 60k
 
Bluefin said:
Are you planning on returning to work full time?

If not (due to medical conditions) but can work part time, apply for partial capacity benefit - you might be eligible
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Hi, I was advised too late that I would have had to apply for partial capacity benefit about 3 months prior to my return to work to allow for the processing time
 
JoeRoberts said:
You should check the policy handbook but this was certainly the case with such employer policies with Irish Lfe many years ago. The policy paid out a percentage of salary but offset the illness benefit "payable to a single adult". It was irrelevant what the actual amount paid was.
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The policy says:
The benefit payable, including amounts
from other sources, cannot exceed a proportion of your salary, typically 2/3rds of salary. The amounts from other sources could include any other salary or earned income, Social Welfare

But I won’t be receiving income from other sources
 
You don't receive personal policy documents for income protection policies from your employer because they are group policies (many people insured on one policy).

The Irish Life guidebook will speak in general terms, e.g. "typically 2/3rds salary", but each employer will have specific arrangements with the insurer.
 
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