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Insurers face up to Equality
Insurers face up to Equality
“All men are created equal.” Thomas Jefferson
“All animals are created equal, but some are created more equal than others.” George Orwell
Most people recognise the need to insure their lives, especially to cover their mortgage and other borrowings. Like many employers, the police service provides a valuable death-in-service benefit. Those with access to the Police Federation’s group cover can add to their life cover on attractive terms. Normally, the only reason to look beyond these 2 group schemes is when you buy a house. You probably want to take out personal life cover for the mortgage debt, and to include your partner.
But a much greater risk is being long term sick – far more likely than dying during your working life. As a nation, we are very bad at covering this risk – and police are no exception. Of course, employers will cover you in the short-term – but not many extend this cover to the longer term. In the police service, you are liable to be placed on half pay after 6 months’ sickness, and no pay after a further 6 months. With no prospect of a recovery, medical retirement will follow – an enhanced pension, but still a considerable loss of income.
In 1997, following the introduction of Regulation 46 (now Reg 28), MPFS launched its Income Protection Plan. This is also known as Permanent Health Insurance – “Permanent” because our cover continues throughout your working life (unless you choose to cancel it). It paid out 60% of your loss of income until age 55 – that age limit is now 60. The benefit is not liable to tax.
Since that time, our claims experience has improved – largely due to the increased prevalence of recuperative duties. We have passed the saving in cost on to our members by reducing premiums and improving benefits. We have added a critical illness benefit of £15,000 that pays out on major medical conditions, such as heart attacks, strokes and diagnosis of serious cancers. We plan further improvements in 2009.
We have had to look at all our protection products to ensure they comply with the new requirements of the EU gender discrimination directive. Where different premiums are charged for males and females, these need to be backed up by national statistics (we are too small to use our own claims experience). More details are on our website www.mpfs.org.uk
· On Private Medical Insurance, there are no statistics to justify discrimination. We charge the same rate for all adults whether they are male or female; someone in police service or their partner
· On Life Assurance, including Mortgage Protection, lower rates are charged for females than males. Our existing rates already reflect the national statistics.
· On Income Protection, higher rates are charged for females than males. However, the national statistics show that we need to increase the premium for females. We will not do this until we improve the benefits in 2009.
Stuart Bell
Chief Executive at MPFS
