Income Protection Insurance: Different Policies

Article published on 10th July 2008

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As well as the more usual fixed-premium Income Protection Insurance policies there are all sorts of other sorts of policies available from different insurers. Be sure to shop around for the policy that is most suitable for your circumstances.

Here are a few:

Renewable Income Protection Insurance's.

As the name implies, these policies give the policyholder a right to renew his or her policy, sometimes with an increase in cover, after a set period of time has elapsed, normally about 5 years. The cost and cover of this renewed contract will usually be based on whatever the prevailing premium rate is for a person of the policyholder's age and occupation at that time. With this sort of policy the premiums will usually begin much more cheaply than with a fixed Income Protection Insurance policy but will then increase with each renewal as the policyholder gets older.

Reviewable Income Protection Insurance's

The term of this sort of Income Protection Insurance policy will generally be the same as with a fixed IPI policy, however the premiums will be reviewed every few years by the insurer and will invariably be increased in line with the company's general rates (not because of the number of claims made by the policyholder or whatever).

This means that the starting premiums for this sort of policy will usually be cheaper than for standard policies - sometimes considerably so.

We will continue looking at the various sorts of Income Protection Insurance policies in our next article.

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