The charter, which was discussed at last week’s IP Summit, suggests buyers need a quality standard which will differentiate income protection from payment protection insurance and reassure them the policy meets minimum standards.
The Charter also believes that to see income protection established as the success it could be providers selling it must:
• Commit to trying to cover as many of those 20 million people as they can
• Commit to paying all valid IP claims expeditiously and publish their claims paid figures annually as a minimum
• Employ policy wordings that are as brief and unambiguous as possible and written in plain English
• Offer own occupation disability as the definition of choice wherever appropriate
• Work to develop a simple IP product with a simple sales and underwriting process
• Work together with the DWP to produce an annual Sick Pay Statement so that the public know what their entitlements are
• Commit to educating the adviser population about the value of income protection
• Agree to have a campaign like the US’s “Disability Awareness” that heightens consumers’ and employers’ attention about the value of income protection insurance
Peter Le Beau, co-chairman of the IP Task Force, said: “The delegates at the summit are feeding back their view on the points the Charter raises.
“It is clear that the advent of simple products is widely seen as a potential opportunity to significantly increase the amount of income protection written and things like claims disclosure and plain English wordings will enable consumers to have a much better understanding of what the product offers and why it is likely to pay all valid claims.
“What the industry must do is to decide how big the available market is and how they can streamline their processes to take advantage of it.”