Product Overview Series – Disability Income Benefit

Product: Pays a percentage of a member’s salary on a monthly basis if they are unable to perform their occupation.

Particulars:

  • Flat percentage, Scale & Tax Modified Scale options available
  • Available until the earlier of the Normal Retirement Age and age 65
  • Can be converted to an Individual Life Policy (if option selected and criteria met)
  • Waiting period – 1,3,6 month options available
  • Conversion option is available up until 5 years prior to benefit cessation age (or up to age 60 with Sanlam)
  • Continuation of remaining benefits on disability may be selected
  • Escalation of benefits during disability is available
  • Employer Waiver can pay the Employer’s retirement funding contributions & the remaining risk premiums, if selected, while the employee receives disability benefits

Additional options for this benefit include Disability Income Top-Up, Medical Aid Premium Waiver & Employer Reimbursement Cover – to be covered in next week’s issue.

Disability Income Benefit Maximums:

  • Capital Alliance – R 175,000pm (Flat, Scale & Tax Modified Scale) or net of tax income (whichever is the lesser)
  • Hollard – R 165,000pm (Flat & Tax Modified Scale) and R 60,000 pm (Scale), restricted to 100% of net salary
  • Sanlam – R 200,000pm (Flat, Scale & Tax Modified Scales) or 100% of the member’s average net monthly income before disability (whichever is the lesser)
  • Old Mutual – R 230,000pm (Flat, Scale & Tax Modified Scale) (incl. Employer Waiver) or Total post-tax cost to company (whichever is the lesser)

Employer Waiver Maximums:

  • Capital Alliance – R 50,000pm
  • Hollard – R 35,000pm
  • Sanlam – R 51,000pm
  • Old Mutual – 20% of Monthly Salary (maximum rand amount is R230,000 for the sum of the PHI benefit plus Employer Waiver)

Thank you and regards,
The TSA Team

You’ll find all back issues of TSA Connect by visiting our blog.

All information provided in TSA Connect newsletters is intended to inform and explain, but please remember to always check the current terms on policies when considering options and advising clients.

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