No more agreed value income protection
You may have noticed your income protection premiums going up and up in recent years. If you have, rest assured you are not alone. This is an industry-wide phenomenon caused by high rates of claims and the impact of the low interest economic environment.
The status quo was simply not sustainable. The industry had lost well over three billion dollars over five years. This led to APRA stepping in and making several changes to income protection products. The first major change came into effect at the beginning of this month, with agreed value income protection products no longer being available to new customers.
Existing agreed value policy holders will however be able to keep their policies.
How will the changes impact me?
Policies issued prior to the changes coming into effect will be grandfathered. These policies have superior feature sets compared to the new policies being issued, however we expect that their premium rates will continue to increase. The new policies on the other hand will have inferior conditions, but should have more affordable premiums.
Please contact us if you would like further information or if you require any assistance with your income protection insurance.