Wage Protector – Protection for the Unprotected
Thu Feb 10 2022


As a Financial Adviser, you know good advice recommends that individual protection forms the basis of every financial plan with Income Protection being the cornerstone of that plan. After all, it pays for everything else; life assurance premiums, pension contributions not to mention all the household expenses that don’t stop coming in just because your income has.
However, you may have a client meeting in your diary where you know the client is not an office worker and the occupation class is likely to be a 3 or 4. You think the premiums are going to be very high for this client and you must then decide whether you recommend income protection or not as you know the premium will be outside the client’s budget parameters.
That’s where our budget friendly income protection plan – Wage Protector comes in. This has been designed for the express reason that Class 3 and 4 occupations were virtually being excluded from buying income protection due to cost.
Wage Protector has all the same features of the full income protection plan, the difference is that it will guarantee to pay out for the first 24 months of the claim. After 24 months to continue to qualify for the claim, your client must pass our functional assessment test. This is a simple, easy-to-understand set of physical and mental ability tests.
Wage Protector is aimed at clients in riskier jobs who are generally more expensive to insure, such as construction workers, electricians, plumbers, mechanical engineers and the self-employed.
How does Wage Protector work?
The product is divided into two types of cover.
Transitional cover: This cover kicks in after the deferred period and pays your client a replacement income for 24 months if they are unable to do their own job. This gives them an opportunity to get back on their feet or prepare for an alternative job. After this initial period, depending on their circumstances, full Disability Cover may apply.
Disability cover: This cover will apply after 24 months if your client is unable to return to any work due to significant illness or injury and suffer a loss of earnings as a result. They must pass a Functional Assessment Test to qualify for this cover. This is a simple, easy to understand set of physical and mental ability tests.
Because the product is designed to pay out in this way, it provides much cheaper cover for these occupations when compared to personal income protection. However, if your client is fully incapacitated, they may be entitled to disability cover which will pay them until they reach retirement age. There is also full tax relief on the premiums, unlike some other short-term products in the market.
Sample Costs of Wage Protector Vs. Personal Income Protection
- Self-employed plumber – Class 4
- Self-employed domestic electrician – Class 3
- Dog Groomer – Class 3
Product | Occupation Class | Weekly benefit | Gross Premium | Net Premium | Percentage cheaper |
Wage Protector | Class 3 | €649 | €91.51 | €54.91 | 53% |
Income Protection | Class 3 | €649 | €173.02 | €103.81 | |
Wage Protector | Class 4 | €649 | €113.38 | €68.09 | 52% |
Income Protection | Class 4 | €649 | €235.68 | €141.41 |
- Quotes based on: Non smoker – age 37 dob 1/07/1985
- Salary €45k, weekly benefit: €649 (75% of salary)
- No indexation, no escalation in claim
- Personal IP – all reviewable as WP is reviewable
- Ceasing age: 65
- Deferred period: 13 weeks (logic, self-employed so no state illness benefits when sick)
Product | Occupation Class | Weekly benefit | Gross Premium | Net Premium | Percentage cheaper |
Wage Protector | Class 3 | €518 | €73.10 | €43.86 | 40% |
Income Protection | Class 3 | €518 | €145.28 | €87.17 |
- Quotes based on: Non smoker – age 37 dob 01/07/1985
- Salary €50k. Entitled to state illness so benefit 75% of salary less €10,556 =€518 per week.
- No escalation, no indexation, personal IP reviewable
- Deferred period 13 weeks.
- Ceasing age 65
This simple table shows the main benefits between Wage Protector versus full Income Protection:
Our Income Protection Products | |
Income Protection | Wage Protector |
Replaces up to 75% of a customer’s earnings up until they reach retirement age or return to work. | Replaces up to 75% of a customer’s earnings for a limited period of up to two years. |
Paid to the end of the policy term or return to work. | 2 Year payment period – claim continues after 24 months if the client passes a functional assessment test. |
Evidence of earnings required | Evidence of earnings required |
Own Occupation | Own Occupation (for first 2 years of claim) |
Waiver of Premium | Waiver of Premium |
Hospital Cash Benefit | Hospital Cash Benefit |
Rehabilitation Benefit | Rehabilitation Benefit |
Overseas Benefit | Overseas Benefit |
Relapse Benefit | Relapse Benefit |
Guaranteed Increase Option | – |
Additional Benefits
Aviva Family Care Benefit *
Everyone is facing new challenges and this confidential telephone based mental health support service offers quick access to tailored mental health advice from qualified psychologists. The HSE Performance Report for January-March 2021 published in The Irish Examiner on new year’s eve shows that more than 10,800 people, including adults, are waiting to see a psychologist – with more than half of these waiting for over a year. The report shows that more than 2,600 children were on waiting lists for mental health services as of last March – over 280 of them waiting longer than a year. HSE figures show Cork and Kerry have one of the biggest waiting lists, with 60 children on it. For no charge with protection from Aviva, your clients can access support at any time of the day or night, seven days a week. It includes 5 sessions and can help if your clients are struggling with a bereavement, feeling stressed or anxious or need help manging the emotional impacts of life events. This service is not only limited to your client, it can also be used by their spouse/partner and children up to age 18 (23 if in full time education).
Patients under 18 years of age are supported with a single assessment session during which they will benefit from a formal diagnosis. At the end of the consultation, practitioner Psychologists will make recommendations and support the patient as well as their carer/guardian/ parent, to access specialised services.
Best Doctors Second Medical Opinion * – access to 50,000 world-renowned specialists
Your clients can get an expert medical opinion from one of our world-renowned specialists to double-check a diagnosis, investigate alternatives & get additional treatment options for any condition affecting your client’s quality of life. This service is exclusive to Aviva and covers your client, their children, spouse or partner as well as their spouse or partner’s parents.
Hospital Cash Benefit
Your client can receive an income if you are in hospital for more than 7 days during the deferred period. This income is equal to 1/365th of the annual benefit for each complete day you remain in hospital. This benefit will cease on the earlier of the 91st day spent in hospital or the end of the deferred period.
It is important to note that full income protection is the optimal option for any client who can afford it but where it’s unaffordable to the client then Wage protector can be a great solution. Please contact your Account Manager to find out more and how best to position this with your potential clients.
Aviva Life & Pensions Ireland does not guarantee the on-going availability of the Best Doctors – Second Medical Opinion benefit to its policyholders or the Aviva Family Care Benefit (Mental Health Support) and may, at its sole discretion, withdraw access to the service at a month’s notice. If we withdraw it, we’ll write to notify policyholders at least 31 days in advance of its removal. Teladoc Health (who provide the Best Doctors and Aviva Family Care Benefit) is not a regulated financial service. Aviva Life & Pensions Ireland Designated Activity Company, a private company limited by shares. Registered in Ireland No. 165970. Registered office at Building 12, Cherrywood Business Park, Loughlinstown, Co. Dublin, D18 W2P5. Aviva Life & Pensions Ireland Designated Activity Company, trading as Aviva Life & Pensions Ireland and Friends First, is regulated by the Central Bank of Ireland.