Demystifying disability waiting periods.

Eugene Taljaard - From time to time we receive queries on disability benefit waiting periods. What they are, who imposes them and why they apply in the first place.

Waiting periods are set when the applicable disability policy contract is instituted. The length of the waiting period normally ties in with the employer’s internal H.R. policy and (sometimes) their short term insurance contract in dealing with someone who is away from work for an extensive period of time. If the employer does not have a formal internal H.R. policy we would advise them to consult with their labour relations adviser with a view to implementing a policy.

Another consideration in deciding upon the length of a waiting period is cost. Clearly the shorter the waiting period the more claims are going to arise and therefore the policy with a 3 month waiting period is going to be more expensive than one with a 6 month waiting period!

The waiting period starts from the person’s last day at work and continues uninterrupted until its completion. Typically the waiting period is 3 or 6 months in length. The purpose of the waiting period is to determine the extent of the disability and to gather all the medical records supporting the claim.

Old Mutual has produced a very informative newsletter covering this topic and with their permission we produce this for your information. Should you wish to discuss your current disability benefit arrangement please contact us.

Remember when comparing costs that not all disability benefit policies are equal.