An insurer does not have to include a claimant’s sales commission earnings when calculating his income protection payments, the financial services ombudsman has ruled.

The policyholder, who was insured under his employer’s group income protection cover with MetLife, lodged a claim in April 2024 after suffering a work-related mental health injury.

MetLife began payments that November but excluded commissions when determining the man’s pre-disability income.

The employer could choose a definition of income for its policy and had selected “total regular income received by the insured person”, rather than an option that included regular commissions.

MetLife said its benefit calculation was correct based on the employer’s choice.

The insured argued his commission payments met the policy definition of income because they were regular and directly tied to his personal performance at work.

But in a dispute ruling, the Australian Financial Complaints Authority has accepted the employer’s choice of definition and the insurer’s calculation.

“The insurer has applied a reasonable interpretation to the policy definition of income when assessing the complainant’s pre-disability income,” the ombudsman said.

Read the ruling here.