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Compare RACS Permanent Disability Insurance Plan for Surgeons


There is a new policy being offered by underwriter Lloyd's of London in conjunction with the Royal Australian College of Surgeons (RACS) which offers $1,000,000 TPD insurance for surgeons.


The major benefits of this TPD insurance policy are as follows:

  • $1,000,000 insurance benefit payable to the surgeon if:

    » due to illness or injury, have not been able to work in any occupation for six months and are unable to ever return to employment as a surgeon; or

    » total and irrecoverable loss of use of two limbs, sight in both eyes or sight of one eye or use of one limb.
  • Or $500,000 payable if the surgeon occupationally acquires HIV or Hep B or C;
  • No medicals required, with automatic cover for a RACS member (either Fellow or Trainee) surgeon if they:

    » have no history of any of the following: cancer, diabetes, heart disease, liver disease, arthritis or degenerative eye disease; or

    » Have not had an insurance application for disability or life insurance deferred, declined or modified from standard terms.
  • Flat payment rate of $2,060 per annum for flat benefit amount of $1,000,000 TPD or $500,000 lump sum blood borne disease cover.

We at Life Shield applaud RACS for raising awareness of Permanent Disability insurance for their members. Any insurance policy is better than none from the perspective of an adviser who has managed claims on behalf of clients, however we believe that surgeons would do well to compare the cost and benefits offered by the type of insurance to others available in the Australian marketplace:

Issues to consider regarding the RACS Permanent Disability Insurance Plan:

  • At a cost of $2,060 per annum, this policy is expensive for any surgeon under the age of 47 (assuming non-smoker, standard rates). This does not take into consideration a further cost discount if you have additional policies such as Income Protection or life insurance at the one insurer;
  • Nowhere in the PDS does it state that all pre-existing conditions are covered by the policy;
  • The policy expires at age 55 whereas most TPD policies can remain in place until age 70;
  • In order to make a claim you need to be absent from any occupation for 6 months rather than specific to your own occupation;
  • There are no inflationary increases to the benefit, therefore your cover amount will decrease in real terms.

So when considering whether you should apply for the RACS Insurance offering, the conclusion is that you should get advice. We work over the phone and via email so feel free to either contact anyof the advisers at Life Shield for some assistance. If you already have an insurance adviser that you already trust and have a good rapport with, please speak to them before making any decisions.

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After having had my income protection, with a company based abroad, for the last 15yrs I recently decided to sort it here in Australia.(Now based here so it makes sense.)
Needless to say the thought of trying to get a similar product for a good price was a concern....

Dr S.T (BDSc)
Newman, WA.

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