Irish Rail workers income protection payment overturned by high court.

The High Court case involved an Irish Rail locomotive driver who initially made a claim on their Utmost Paneurope DAC income protection policy in November 2014 and whose claim was accepted in December 2014. 

However, the policy stipulated that after 24 months of payments, the definition of a disability would change from being unable to perform locomotive driving duties due to his illness to a definition based on his being unable to carry out “any rail operative occupation” due to his illness.

The opinion of the insurer’s doctor examining the driver found that he was undergoing psychiatric treatment for his illness and was on medication and that his illness would not prevent him from carrying out other railway operative duties. 

The driver was informed by his income protection insurer that his payments would cease in February 2017.

The man appealed this decision to the Financial Services and Pensions Ombudsman and the ombudsman directed that the decision by Utmost was wrongful, that payments should be reinstated and Utmost should make up any loss to the driver for the time that he was not paid.

However, the High Court overturned the ombudsman’s decision stating that it was flawed “by serious and significant errors” and asked that the decision be sent back to the ombudsman for fresh consideration. This meant that the insurer’s decision on the driver’s claim was upheld.

The take away from this court ruling is the importance of choosing the correct income protection policy and looking carefully at the definition of disability contained in any policy that you are considering purchasing.

It is also essential that you check which types of illness are covered by your policy, as the types of illness that are protected in income protection policies, as well as the severity of the illness or disability eligible for the benefit, can vary between insurers.

There is a crucial difference between income protection policies with an ‘own occupation’ definition of disability, meaning that you are eligible for benefit if you are unable to carry out your current occupation, and ‘any occupation’ definitions of disability which are based on a much more stringent definition of disability.

This distinction is even more crucial where your occupation is a specialised or professional occupation, where illness or disability may prevent you from carrying out your own role.

It is, however, also possible to purchase shorter term, ‘wage protector’ income insurance which is more affordable, available to those in a wider range of jobs, and offers more basic cover affordably if this suits you better.

Be reassured that income protection policies do pay out and the majority of claims are successful. Income protection remains an essential safety net for those who cannot work because of illness or injury.

Insurance companies pay out on income protection policies every year until the claimant is well enough to return to work and the financial support offered by income protection insurance has helped many policyholders who are unable to work.

Income protection is a vital form of protection where you and your loved ones rely on your salary or earnings as it pays a monthly income of up to 75% of your salary or wages until you  are well enough to return to work if you are unexpectedly ill or injured.

Income protection premiums are also eligible for tax relief at your marginal rate of income tax which makes it even more affordable to insure your income.

Income protection policies can be complex and it is essential that you compare different types of policy to find the best fit for your needs and circumstances and read the small print before purchasing.

Insure your income can help you with expert advice from qualified advisors. We can compare products from the five income protection companies to find the best policy for you.

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We also specialise in industry specific income protection insurance.

Don’t leave it until it is too late, insure your income so that you can meet your regular outgoings even if you are unable to work.

We work with the major income protection insurers and offer free quotes and a complimentary phone consultation with an income protection advisor. 

Fill out our income protection insurance assessment form and we will contact you to discuss your options with you.