When is a member considered to be disabled?
The disability benefit covers a member if he or she is totally disabled whether this is temporary or permanent. The member must not be capable of engaging in his or her own occupation or similar occupation due to illness or injury. Please refer to the policy document for more information.
What if the member is ill before joining?
The pre-existing condition clause states that no benefit is payable during the first 12 months following a new member's entry date if, in the opinion of the insurer, the member was disabled as a result of any injury, illness or condition that the member knew about or was diagnosed with, within the 12 months prior to the entry date.
This means that if a member is not well before he or she joins the LPF and then becomes disabled within 12 months of joining the LPF, he or she may not be covered for disability benefits. Please refer to the policy document or contact Alexander Forbes for more information.
What is the disability salary?
The disability salary is generally the same as the salary nominated for the member’s provident fund contributions. This is provided that the member has not declared a lower disability salary or the member's Fund salary is higher than the current Free Cover Limit set by the insurer.
To underwrite a salary of more than the Free Cover Limit, the insurer will require medical evidence of good health. This means that a doctor will have to complete certain forms to declare that the member does not have any medical problems. Please contact Alexander Forbes for more information.
Period of cover?
Whilst the member is employed by the participating employer, the disability benefit is in place until the member reaches age of 65. Thereafter, it falls away with no surrender value. There is no continuation option on resignation.
Benefit paid on claim?
The disability benefit is paid if the member becomes totally disabled and unable to continue with his occupation whether this is temporary or permanent.
The benefit to be paid on claim is 75% of the member’s disability salary and the first payment is made after the three-month waiting period. The benefit is paid until the member’s recovery, death or retirement. For members with a disability salary of more than R 31 500.00 the benefit is calculated according to a scale. Please contact Alexander Forbes for the details of this scale.
- The benefit escalates annually. The escalation rate is limited to a maximum of the increase in the Consumer Price Index over the preceding year.
- The member’s provident fund benefit continues as the insurer pays the employer’s contribution of 5%, up to the policy maximum.
- The member may choose to continue the life cover benefit.