An optional feature that can be important when considering income protection insurance. In the event of a claim the amount you receive each year is increased in line with inflation. Without this feature during a long term claim your monthly benefit payment would not increase and may affect your standard of living.
Increasing cover with inflation
All life insurance policies have a feature that automatically increases the benefit amount and premiums with inflation. (See also inflation protection).
Indemnity Style Policy
The benefit amount you would receive on an income protection policy is determined at the time of claim. This means that in the event of a claim you must verify your current income (rather than during the application process). If your income has reduced since you applied for cover, your claim will be paid on the reduced amount. Further information is available on our indemnity income protection page. (See also Agreed Value Policy)
As soon as an application for insurance is lodged, interim cover will be put in place. With Life Insurance this will mean accidental death cover is in place while the application is underwritten.
Insurance that pays an agreed lump sum if you pass away or are diagnosed with a terminal illness, with less than 12 months to live.