Wait Period
A wait period is the length of time you must be unable to work before your Income Protection or Mortgage Protection benefits begin to be paid.
A wait period is the time between when you're unable to work due to illness or injury and when your insurance starts paying a benefit. Common wait periods include 2 weeks, 4 weeks, 8 weeks, 13 weeks and 26 weeks, although the options available vary between insurers.
The wait period you choose can have a significant impact on your premium. Generally, a shorter wait period means your insurer may start paying sooner if you need to claim, but your premiums will usually be higher. A longer wait period often results in lower premiums because you're covering more of the initial time off work yourself.
When deciding on a wait period, it's important to consider how long you could manage financially without your regular income. This might include using savings, annual leave, sick leave or other financial resources before your insurance benefits begin.
Your wait period starts from the date you meet your policy's definition of disability, not from the date you lodge your claim. Choosing the right wait period is about balancing affordable premiums with the financial support you'll need if you're unable to work.
Why It Matters
Your wait period affects both the cost of your insurance and how quickly you'll receive financial support if you're unable to work. Choosing a wait period that matches your financial situation can make a big difference during an unexpected illness or injury.
Common Misunderstandings
"The wait period starts when I submit my claim."
No. It usually starts from the date you become unable to work and meet your policy's claim definition.
"A shorter wait period is always better."
Not necessarily. While benefits may start sooner, shorter wait periods generally come with higher premiums.
"The wait period is the same as the payment period."
No. The wait period is how long you wait before benefits begin, while the payment period is how long benefits can continue to be paid.
"Everyone should choose the shortest wait period."
Not always. The right option depends on your savings, leave entitlements and ability to manage financially before benefits start.
FAQs about Wait Period
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Consider how long you could comfortably cover your living expenses using savings, leave entitlements or other financial resources.
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In many cases, yes. However, changing your wait period may affect your premium and could require underwriting.
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It can. Depending on your policy and the reason for your claim, ACC may provide support during your wait period.
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A wait period is the time before your benefits begin after a claim. A stand down period is a separate policy condition that may limit cover for certain conditions when your policy first starts.
Choosing the right wait period is an important part of making sure your Income or Mortgage Cover works when you need it most. If you're unsure which option best suits your financial situation, talk to a New Vision Financial Services adviser. We'll help you find a balance between affordable premiums and the protection that's right for you.