Risk Equalisation – What is this?
From 21st of December 2012, it will no longer be possible for Life Insurers to use gender, or related factors in calculating premiums for benefits for their products.
The judgement passed by the ECJ (European court of Justice) will have implications for all protection lines including;
- Life Insurance
- Serious Illness Cover &
- Income Protection
It will also have an impact for annuity pricing and indeed for general insurance (car insurance) and health insurance too.
What impact will this have on Clients?
It is difficult to access at the moment but ultimately, we see life cover premiums
for female lives increasing by between 30% to 50% on current rates over the longer term. We would also see income protection premiums for male lives increasing also. It is hard to estimate the price increase but again it could be up on 50% on current income protection rates.
What should you do?
If you are female and have been thinking about taking out a life policy do so now. It will be important to pick the right protection plan, one that is flexible so that if you ever need to increase cover you will still be able to avail of today’s rates for female lives.
If you have life cover in place it is important to review this to make sure that your current plan is flexible and that if you do increase cover down the line that you will not be hit with the dearer premiums coming
If you are male and do not have income protection take out a policy now. Leaving aside the increase that is coming down the line, everyone should have income protection. Your income is your biggest asset. Protect it!
Call our office today on 0719159222 or email me at email@example.com and I will be able to help you pick the right plan.