Executive income protection age limits
There is no single age limit for executive income protection. Insurers set their own minimum and maximum ages for taking out cover, as well as an age by which the policy must end.
Age also affects the price. A director arranging cover in their 50s will normally pay more than someone taking out similar protection in their 30s or 40s.
What is the maximum age for executive income protection?
The maximum age depends on the insurer and the type of cover.
There are two age limits to look at:
- Maximum entry age – how old you can be when you take out the policy.
- Maximum policy end age – the maximum age you can be when the cover ends.
These are not necessarily the same.
An insurer might allow you to take out a policy in your 50s but allow the cover itself to continue into your 60s.
The limits vary across the market and can also depend on your occupation, so check both figures when comparing policies.
Is there a minimum age?
Insurers also set a minimum age for taking out executive income protection, although this is unlikely to be an issue for most company directors.
In practice, the maximum entry age and policy end age are usually more important when comparing cover.
Can you get executive income protection in your 50s?
Yes. You can still take out executive income protection in your 50s, provided you fall within the insurer’s entry age and meet its other requirements.
You are likely to pay more than you would have done for the same cover at a younger age, and there will be fewer years between taking out the policy and its end date.
Your health will also be assessed when you apply. Previous or existing medical conditions can affect the premium, exclusions or other terms you’re offered.
For more information on this, read our guide to executive income protection and pre-existing medical conditions.
Why does executive income protection cost more as you get older?
Age is one of the factors insurers use when setting income protection premiums.
As you get older, the likelihood of suffering an illness that keeps you off work increases. So, if you take out a new policy at 55, you would normally expect to pay more than you would for the same cover at 35.
Age isn’t the only factor. Your occupation, health, monthly benefit, deferred period and length of cover will all have an effect on the price.
For more information, including indicative examples, read our guide to how much executive income protection costs.
What age can the policy run until?
Executive income protection is normally arranged with an end age or policy end date, often based around when you expect to retire or stop working.
For example, a director aged 45 might arrange cover to age 65. If they made a valid long-term claim at 55, payments could potentially continue until they recovered or reached the policy end age, subject to the terms of the policy.
Someone taking out cover at 58 obviously has much less time before reaching the same end age.
So check how long the policy can actually run for, not just whether you’re young enough to take it out.
Does your occupation affect the maximum age?
It can. Some occupations may have lower maximum ages or restrictions on how long cover can continue.
Work involving significant physical activity, driving or other occupational risks may be treated differently from office-based work.
Your actual duties matter here. Describing yourself simply as a company director doesn’t tell an insurer what you do from day to day.
Two directors of the same age could therefore be offered different terms because their jobs are very different.
For more information on how insurers look at the work you do, read our guide to own occupation executive income protection.
Does the benefit period change the age limit?
The benefit period and policy end age are two different things.
You might have short-term cover that pays an individual claim for one, two or five years, while the policy itself remains in place until a much later age.
With long-term cover, a claim can potentially continue until you recover or reach the end of the policy.
For more information on the difference, read our guide to how long income protection can pay you for.
What if you plan to work beyond 65?
Plenty of company directors continue working beyond 65.
If that’s what you expect to do, check how long each policy can remain in force. The maximum age available will depend on the insurer and may also depend on your occupation.
Don’t automatically choose 65 as the end age if you expect to carry on working beyond it.
Is it better to take out cover when you are younger?
There are some advantages to arranging cover earlier.
You’ll normally pay less for new cover when you’re younger, and you may have fewer health issues for the insurer to consider. You can also potentially have the policy in place for longer.
That doesn’t mean taking out cover as early as possible is automatically the right choice. You still need to decide how much protection you need and whether the premium is worthwhile for your circumstances.
For more information on choosing the benefit, read our guide to how much executive income protection you need.
Check both age limits before applying
If you’re in your 50s or approaching retirement, check both the maximum entry age and the age at which the policy must end.
Also check how long a claim can be paid and whether your occupation affects the maximum term available.
Age limits aren’t the same across the market. If you’re too old for one particular policy, it doesn’t necessarily mean you can’t get executive income protection elsewhere.
If you’re considering executive income protection, a specialist IFA can check which insurers will cover you at your age, answer your questions and compare quotes from leading providers.