Whats the difference between Personal Accident and Sickness Insurance

and an Income Protection Policy?

Personal accident and sickness Insurance policies are generally suitable for short to medium-term disability cover, but you need to keep in mind that they may be cancelled at the insurer’s discretion, or the insurer may decline to offer renewal of the policy, if there are changes in the life insured's health or occupation.


Personal accident and sickness insurance policies have a far broader range of exclusions than income protection insurance policies. For instance, they often include the following, participation in organised football, driving or riding in any kind of race, exposure to radioactivity, driving under influence (DUI) or drugs, mental disorders, criminal activity, and others which are not generally excluded in income protection insurance policies.

Income Protection policies are issued by life insurance companies are generally guaranteed renewable. A guaranteed renewable policy means that an insurer cannot cancel the policy irrespective of the number of claims made under the particular policy, or any change to the state of your health, occupation, or past-times.

Income protection insurance provides longer term cover and additional standard benefits, as well as security for people, who can rest assured that only they can cancel the policy throughout the life of the policy.

Example - Consider Brian who is a plumber and has an ongoing personal sickness and accident insurance policy. Brian injures his hand at work and is off work for two months, shortly after returning to work he becomes unwell and is off work again on doctor’s instructions for a further 6 weeks.

Under his Personal Sickness and Accident Insurance Policy his insurance company will be able to decide if the policy would continue and under what terms. It is unlikely a general insurance company would continue cover for Brian under these circumstances.

On the other hand, if Brian has Income protection his policy is guaranteed renewable so his cover will continue no matter how many times he makes a claim.

General Advice Warning: Please be aware that any advice that may have been given or implied is general advice only. We have not taken into consideration your individual needs, objectives or financial requirements. Before deciding to purchase a financial product, you should consider the appropriate Product Disclosure Statement to ensure the product is suitable for your needs.