Claiming Across Multiple Insurance Policies
In this Advisr Experts Opinion, Greg Dobrin, of Sureserve Financial Services, discusses the misconceptions surrounding claiming on several insurance policies and the actions you can take to claim across multiple insurance policies.
It is often the case when people have multiple policies they have concerns whether they can claim on each policy.
The general rule here is, if you are insured for it, you can make a claim in the event that the insured incident occurs.
Policy holders can have multiple policies and can claim against multiple policies for a lump sum policy:
- Critical illness
- Total and permanent disability
The exception to this is if one policy has been issued on the condition another policy is to be cancelled. Income protection insurance (where the benefit is paid monthly and is based on the insured's income) works differently to lump sum policies. The premise of income protection insurance is that the policy owner can only insure their income.
Income protection policies may have an offset clause. So it is good to check your policy and seek professional advice from an insurance expert.
An offset clause, can allow an insurer to reduce the benefit they would pay by the amount of benefit that will be paid from another insurer. This can create a "vicious circle"; whereby one insurer will reduce their benefit payment by the amount expecting to be paid by another insurer. Therefore, it is important to read the fine print and know what you are agreeing to when you sign the contract.
To avoid future problems like these, make sure you get yourself a top insurance broker who can help you through the ins and outs of insurance.