Undoubtedly one of the most important considerations when taking out income protection is the occupation definition that the cover is based on. There are a range of occupation definitions used by different insurance companies and the key points to know is that there is only one type that is guaranteed to pay out if an accident or illness means that you cannot do their normal daily duties of your job and it is the OWN-OCCUPATION DEFINITION. We strongly believe that this is the type of cover that you should take out, if it is available.
The different occupation definitions are shown below, with a brief description of what they mean.
Own occupation – a claim is valid if you’re unable to do your normal work duties. This offers the best available protection.
Suited occupation – a claim is valid if you are unable to do any job that is deemed suitable to you, based upon your work skills or experience and education. While not as good as own occupation cover it still provides a good level of protection.
Any occupation – a claim is valid if you have the inability to perform the duties of any occupation. This definition of disability is extremely strict and to receive benefits according to this definition, you have to be unable to work in any occupation, not just your own. To put this into context, if you had a manual occupation, such as a carpenter and had an accident that led to you being paralysed, you may be unable to claim as you would still be capable of working at a call centre.
Work tasks – a claim is valid only if you are unable to carry out a number of tasks from a predetermined list, such as.
- Using a pen, pencil or keyboard
Activities of daily living – Possibly the most difficult definition to make a successful claim under, you would have to be unable to carry out 3 or more of the following types of activities.
- Move from a bed to a wheelchair or get on or off a toilet.
- Be able to manage bowel or bladder functions to maintain personal hygiene.
- The ability to dress and undress, including any medical devices used.
- Move from one room to another, on level surface, in your normal residence.
- Be able to feed yourself once prepared food has been supplied.
- Capacity to enter / exit and wash in the shower or bath to maintain hygiene.
To claim under this definition you would typically be expected to need daily assistance to help with personal care needs, which hints at the level of incapacity needed to succeed In a claim.