The Exeter has combined two of its flagship income protection products, Income One and Pure Protection, to form a new ‘Income First’ offering.
The insurance specialist said it intends to “simplify” the process of buying income protection.
To this end it reduced the need for medical evidence at the point of underwriting, particularly for under 42-year-olds, while increasing the threshold for financial evidence.
And in response to adviser feedback, the insurance provider is introducing level guaranteed premiums across all occupation classes.
Members who change employment during the term of their policy and find their new probation periods restrict sick pay, can now receive claimed benefits before their waiting period finishes.
Adam Higgs, Protection Guru’s research head, said The Exeter was “the first insurer to move in this direction”.
He continued: “For a long time we have challenged income protection insurers to do more to accommodate the changes in circumstance clients will inevitably go through. Whilst we think The Exeter could extend this further this is a valuable benefit in its own right.”
Higgs also cited the “sick pay matching for NHS medical professionals and public school teachers”, which he reckons will “make The Exeter a more attractive proposition to far more clients”.
Steve Bryan, The Exeter’s distribution and marketing director, said the insurer had seen “substantial growth” in its income protection business over the past five years.
He added: “Income protection should be the number one priority when it comes to protecting financial futures, and so we’re building on our expertise, as well as feedback from advisers, to evolve our product further.”
The Exeter is not the only insurer to innovate in the income protection space of late.
At the end of last month, Nationwide launched an income protection product designed to cover self-employed workers unable to work due to illness or injury.
Research conducted by The Exeter suggested just 9 per cent of self-employed workers’ incomes are protected through insurance.
Alan Lakey, director of CIExpert, told FTAdviser Nationwide’s plan “to sensibly cover the recently self-employed is extremely welcome”.
As a whole, the income protection industry is still ripe for disruption and innovation though.
Last month, the Income Protection Task Force (IPTF) announced it was embarking on an awareness campaign to raise the profile of the protection industry, which saw individual sales drop 1.2 per cent last year.
Roy McLoughlin, who was the IPTF’s co-chairman until January this year, told FTAdviser when he sat down with advisers in recent years to discuss income protection, he was often greeted with “blank faces”.
“The awareness was quite embarrassing to be honest,” he said. “We need to convince IFAs and mortgage brokers that they need to talk about income protection before any other protection.”