Group Income Protection 

Group Income Protection is designed specifically for the workplace. It pays a percentage of lost income on a monthly basis to your employees if they are unable to work due to an illness or injury.

Group Income Protection is a cost efficient way to complement any employment package, helping you to attract and retain valuable employees.

Cover is provided 24 hours a day, seven days a week, giving your staff the reassurance that they are protected even if all illness or injury happens when they are not at work.

At a glance

What health information do I need to provide?

In many cases health information is not needed. If your group scheme is of sufficient size and has at least a 75% take-up rate of eligible employees, TOWER may provide an Automatic Acceptance Limit (AAL). This means most employees can be covered up to the AAL amount within 60 days of becoming eligible, without providing evidence of health. If they decide to join after the eligibility period, health information will be required.

Where an AAL does not apply, employees will need to provide relevant health information.

Your adviser or TOWER Business Development Manager will let you know if an AAL applies to your group scheme.

What is total disablement?

Total disablement means the eligible employee is unable, due to an illness or injury;

1. to perform the usual duties of his or her occupation for the first two years of any one period of disablement; and

2.during the remainder of such period of disablement, to perform the usual duties of any gainful occupation for which he or she is reasonably qualifies by knowledge or experience.

Supporting evidence from a medical practitioner will be required.

In some cases it may be possible to apply part one of the definition for the full period of disablement. An additional premium applies for this option.

How does Group Income Protection impact on ACC or other ongoing income?

The eligible employee may receive other benefits or income while they are disabled and unable to work, e.g. ACC, sickness benefit, ongoing business income. TOWER subtracts other income your employees are still receiving, or are entitled to receive (excluding investment income), and any benefits from another source in connection with the same disability, from the amount we pay.

We do this to ensure the income your employees are receiving during the period of their disability, including their monthly benefit, remains relative to their income before becoming disabled.

What features are included in the cover for no additional premium?

Proportionate benefit
We recognise that in some situations there needs to be a gradual return to work. Group Income Protection allows for a payment to be made relative to the reduced income, if the eligible employee’s earnings have dropped by at least $400 per month.

Rehabilitation benefit
This benefit will help the eligible employee return to work by paying the costs (up to the annual sum insured) of an approved rehabilitation programme. The rehabilitation benefit is available for up to 12 months, but can only be used once for any one period of total disablement.

Recurrent disablement benefit
Rehabilitation from an illness or injury can take time and your eligible employees may experience a recurrence of the condition. In the event of a recurrence, we will not apply a wait period if the time taken off work is within six months of the previous time off work, provided it is because of the same disability initially claimed for, and the cover has not expired.

Hospitalisation benefit
If an eligible employee has been admitted to hospital, we will pay the daily hospital expenses after the first three consecutive days (up to a maximum of 30 days) in addition to the regular Group Income Protection monthly benefit. The maximum hospitalisation benefit payable is the eligible employee’s actual monthly income.

Funeral benefit
In the unfortunate event that an eligible employee dies while they are receiving a Group Income Protection benefit, we will pay three times their actual monthly income to their family upon notification of their death.

Waiver of premium
While an eligible employee is receiving disability claim payments under Group Income Protection, we will waive all premiums for their cover.

Continuation option
Our continuation option allows your employees to purchase a personal income protection policy without any health information, within 60 days of their last day of employment with you, providing they are under 65 years when they leave and they are moving to new permanent employment.

What options can be added to the cover?

Claim escalation option
This is a valuable option which, if chosen, helps to ensure the buying power of your employee’s disability claim payments do not diminish over time. It increases their claim payments by the latest CPI increase (up to your choice of 3% or 5%), at each policy anniversary date. An additional premium applies to this option.

For more information

With experience in managing employee benefits packages for over 300 employers, you can trust TOWER to provide a high quality solution that meets the needs of your organisation. By taking advantage of the size of your group, your employees can have access to better rates than they might have as individuals.

To discuss how we can help you or for full details of policy terms and conditions (including exclusions), please phone 0800 755 556, Monday to Friday, 8.00am to 4.30pm, or email employee.benefits@tower.co.nz.