Income Protection insurance is about to make a change – for the worse.
The gold standard of income protection, has long been “agreed value” policies, and these have been the products that most advisers have recommended to their clients.
With agreed value contracts, the amount that you will receive when you go “on claim”, is agreed up front, at the time of taking out the policy, and is based on your income at the time of taking the policy out. This provides a high level of certainty of your cover. As Always, there is a catch. If the insurance company needs to (e.g. if it is losing money), then it can increase your premium (well, not just your premium but the premiums of everybody who has that sort of cover).
...