Increase in income protection claims

For employers, this increase in claims is concerning as it may lead to rate increases when the time comes to renew group income protection policies where your business has had claims on their group income protection policy.

In order to avoid rate increases, employers may have to take a more active role in managing employee absences such as:

Working with your group income protection claims handler remains the best way to support staff who are unable to work and need to make a claim on their employer’s policy.

Group income protection also remains a really important benefit in recruiting and retaining top staff for employers, having a happy and productive workforce, and providing a tax efficient way to manage unavoidable staff absenteeism.

While the Irish Life research seems to focus on group income protection for employees, personal income protection policyholders may be concerned that this will affect their income protection cover.

Be reassured Irish Life has stated that they are committed to playing valid claims and that their assessment processes have not changed as a result of the increase in claims.

Aviva have also paid an average annual benefit of over €940 per week to income protection claimants in 2023, as well as increasing spending on rehabilitation for customers with claims to €250,000.

Income protection remains a really important form of financial protection and the importance of income protection as a safety net to individuals and families at a stressful and challenging time is recognised by income protection insurers.

It is, as it always has been, essential to work with your income protection claims team and inform them where you may be out of work due to illness, injury, or disability as soon as you feel that you may need to take time off from work.

There are always claims that do not progress as the claimant has returned to work before the deferred period in their policy has elapsed but it can still make your claim run more smoothly if you inform your income protection insurer as soon as possible.

Personal income protection has always been available with guaranteed premiums, which are fixed for the term of the policy at the outset and fixed, or guaranteed premiums, are useful for financial planning so you will not face a rise in your premiums as the policy term goes on.

Although pent up demand for income protection following the economic downturn, as well as the demands on income protection cover due to an ageing population coupled with an emerging increase in mental health have all contributed to an upturn in income protection claims, income protection insurers remain committed to paying valid claims.

There has been no change in Irish Life assessment of claims processes according to the insurer, despite this increase in claims.

Aviva paid out €51 million in income protection claims in 2023.

Whether you are an employer, or you have a group or personal income protection policy, you can be reassured that an increase in claims will not lead to any reduction in your cover and, the advice remains that you work with your income protection insurer regarding claims or potential claims as soon as possible.