Where a claim extends beyond two years, IP payments will reduce to 60 percent. However, with extended or degrading illness or injury, a client may trigger their Crisis Extension and TPD policies which could then be used to supplement their loss of income and pay off debt.
This strategy allows IP to work at replacing income and enables the other benefits to do the heavy lifting of helping cover debt and cover future earnings lost, while maximising premium efficiencies.
This strategy could be used where illness or injury is longer than two years with the potential to return to work. If they’re unable to return to work, their cover may have helped reduce or clear their debt, while they are still receiving an income benefit.
If unfortunately, the client’s circumstances lead to death, they will have their Life Cover in place to provide financial support for their family.
To learn more about the Stepping-Stone Strategy, click here to read our Technical Position paper.