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Monday, June 8, 2015 - 02:16
Covering shortfalls

Sending your children to a good school, providing healthy food, even the odd restaurant meal, and family holidays are some benefits and responsibilities of working hard. What if you lost the ability to earn that income? It's hard to imagine, but sometimes life has a way of interfering with well-laid plans in unkind ways. Are you able to ensure that your family will still be able to grow and prosper if your earning ability is cut short?

“The ability to maintain expenses can be dramatically compromised by a severe illness, disability or even death of the income earner, leaving family members no option but to downgrade their living standards,” says Gareth Friedlander, Discovery Life’s Head of Research and Product Development.
Most people have insurance to cover, for example, their car or medical aid, but not their income. In response to life-altering events that curtail or completely ruin someone’s earning ability, the insurance industry has developed so-called ‘income replacement’ policies.
Friedlander says that a good income replacement policy, such as Discovery Life’s Income Continuation Benefit (ICB), has to cover essential expenses that the breadwinner is no longer able to provide, including:
o A permanent disability lump-sum benefit
o A temporary disability benefit that can pay monthly
o Family benefits in the instance that a child or spouse experiences a life-changing event
o Lifestyle protectors

Qualifying for Discovery Life’s Income Continuation Benefit is a simple case of performing a financial needs analysis (how much money your family will need to maintain their standard of living) with a financial advisor. This analysis will consider all your needs and be tailored to meet your expenses, including the average premiums you would pay. The premiums depend on your lifestyle, pre-existing medical conditions, medical tests, and the funding pattern that you choose.
But you will need to keep in mind the impact of inflation on benefit pay-outs.
“Clients who expect their income to grow faster than inflation have to consider a benefit that can guarantee them claim pay-outs well above inflation,” says Friedlander.
Discovery Life recently announced enhancements to its Income Continuation Benefit (ICB), which includes comprehensive income and lifestyle protection and a broadened claims criteria. More than just replacing income, it takes care of specific daily and monthly expenses. Key features of the enhanced Discovery Income Continuation Benefit include:
o Full lifestyle protection
o Up to 100% of insurance and retirement contributions
o 100% off Uber chauffeur services to ensure that clients and their family will still be mobile following a debilitating event
o Up to 100% off a variety of key living expenses such as HealthyFood, HealthyCare and HealthyGear items leveraging the existing Vitality services.
o Continuity of income for up to six months if a family member becomes ill and clients need to take time off work.

For their part professionals, such as physicians, will also enjoy significant benefits:
• Premium discounts.
• Retrospective payments from day one under a one-month waiting period option
• The ability for in-claims payments to escalate by inflation plus 3%, matching a client’s typically high salary growth expectation
• The ability to claim for the first two years without having to prove loss of income

Cover into retirement

With the Whole of Life option, Discovery Life’s Income Continuation Benefit will protect clients against disability or illness after age 70. This option includes tailored and comprehensive claims criteria as well as unique features like the Contribution Protector, which will cover all of a client’s Discovery Health, Discovery Life, Discovery Insure and Vitality contributions for up to two years in retirement and a six-month guaranteed payment period.
Through Discovery Health’s HealthID technology, claims can be submitted and assessed electronically by the client’s doctor as soon as the doctor books the client off work, streamlining the process. This allows the claims process to be triggered automatically without clients having to initiate a claim. In addition, Discovery’s Claims Concierge service will provide Discovery Health clients with a tailored, high-touch claims experience.

Copyright © Insurance Times and Investments® Vol:28.6 1st June, 2015
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