What Is a Deferred Period for Income Protection?

What is the deferred period?

The deferred period (also called the waiting period or excess period) is the length of time you must be continuously unable to work before your income protection policy starts paying out. Common options are:

• 4 weeks — cover kicks in quickly; most expensive
• 8 weeks
• 13 weeks (3 months) — the most popular choice
• 26 weeks (6 months) — significantly cheaper
• 52 weeks (1 year) — cheapest option; only suitable with substantial savings

How does the deferred period affect cost?

Longer deferred periods = lower premiums. Typically:

• Moving from 4-week to 13-week deferred period: saves ~20–25%
• Moving from 13-week to 26-week: saves ~25–35%
• Moving from 13-week to 52-week: saves ~40–50%

How to choose the right deferred period

Match your deferred period to how long you can sustain yourself financially without the policy paying out:

• If you have 3 months of savings → 13-week deferred period
• If your employer pays full salary for 6 months → 26-week deferred period
• If you have 12 months of savings → 52-week deferred period
• If you're self-employed with no savings → 4-week deferred period

What counts as the start of the deferred period?

The deferred period starts from the first day you are continuously unable to work due to illness or injury. You must remain unable to work throughout the deferred period for the policy to begin paying. If you return to work and then become ill again, the deferred period restarts (subject to policy terms — some offer a "linked claims" provision).

Linked claims provision

Some policies offer linked claims — if you return to work for a short period (e.g. 6 months) and then become unable to work again for the same condition, the deferred period does not restart. This is a valuable feature to look for.