Own Occupation – Income Protection and Critical Illness

Considered to be the ‘Golden Egg’ of income protection and also the disability benefits of critical illness cover, Own Occupation cover is more likely to result in a successful claim.

What does it mean and why is it so much better?

Cover that is based on an individuals ‘own occupation’ will quite simply pay a valid claim if any sickness or injury prevents that person from being able to do THEIR OWN JOB.

The reason for referring to a ‘valid’ claim is because, if an applicant doesn’t disclose all the facts when they apply, a claim could be refused.

An example of own occupation cover at work would be something like a banker suffering from a lengthy bout of depression. Their doctor might sign them off work and if they have some income protection set up on an own occupation basis then a valid claim will be paid.

It’s a little different for the disability benefits of critical illness cover because they refer to ‘total & permanent disability’ so a policy holder need to be signed off work for good or suffer from something more debilitating before a claim is paid but once again,  it only needs to stop that person doing their very own job.

Most office workers, sales people, shop assistants and admin staff are eligible for own occupation cover but unfortunately most manually skilled workers like plumbers, carpenters and crane drivers aren’t.

This list varies slightly from one insurer to the next so to confirm eligibility it makes sense to talk to a broker who can phone around and find out the facts.

Any broker not trying to find own occupation cover for their clients is doing them a disservice.

The alternative to own occupation cover is often referred to as a ‘work tasks’ or ‘any occupation’ definition and what this broadly means is a person must be physically unable to perform certain tasks or do any job at all before a claim can be considered.

There is some variety in the market but typically these tasks include walking, using a pen, dressing oneself, climbing stairs, lifting, seeing and hearing.

Putting this into perspective; if a carpenter, with an ‘any occupation’ definition income protection policy, loses a hand to a circular saw he could still potentially go and get a job as a car salesman so a claim would not be paid.

If a banker loses a hand in an unfortunate electric car window accident and can no longer do the job they are employed to do they’d be able to make a claim and be paid an income for the remaining term of their policy.

It is far better to have cover that pays if you can’t do your job as opposed to cover that either means you have to find a new job after suffering from ill fate or you have to be very seriously disabled.

Sometimes the own occupation definition is optional so make sure it is selected or, if it isn’t, try to find out why.