What to expect during executive income protection underwriting
Before an insurer offers executive income protection, they’ll assess your application to decide whether to provide cover and on what terms. This process is known as underwriting.
For most limited company directors, underwriting simply involves answering questions about your health, occupation and income. Some applications are accepted immediately, while others require additional medical information.
Most applications are approved using the information you provide. Where further evidence is needed, the insurer will normally arrange this directly with your consent.
What information will you be asked for?
The application usually covers:
- Your age and occupation.
- Your salary and, where relevant, dividend income.
- Your medical history.
- Current medication.
- Smoking status.
- Hazardous sports or hobbies.
You’ll also be asked about any previous periods of sickness absence, ongoing medical investigations and existing insurance policies.
It’s important to answer every question accurately. Insurers rely on the information you provide when deciding whether to offer cover and assessing future claims.
Will you need a medical examination?
Not usually.
Many executive income protection policies are accepted without a medical examination.
If you’re applying for a higher level of benefit, have disclosed an existing medical condition or are older, the insurer may request additional evidence.
This could include:
- A report from your GP.
- A telephone medical interview.
- A nurse screening.
- Routine measurements such as height, weight or blood pressure.
- Occasionally, blood or urine tests.
Any medical evidence is normally arranged by the insurer, with your permission.
Does your occupation matter?
Yes.
Insurers assess both your occupation and the type of work you carry out.
Office-based directors, consultants and many professional contractors generally attract lower premiums than people working in more hazardous occupations.
Your occupation can also influence the policy definitions available, including whether own occupation cover is offered.
What if you have an existing medical condition?
Having a medical condition does not automatically prevent you from obtaining cover.
Depending on the circumstances, an insurer may:
- Offer standard terms.
- Increase the premium.
- Exclude claims relating to a particular condition.
- Request further medical evidence before making a decision.
- Decline the application.
Different insurers assess medical conditions differently, so outcomes can vary from one provider to another.
How long does underwriting take?
Straightforward applications may be completed within a few working days.
If additional medical evidence is required, underwriting can take several weeks, particularly where a GP report is needed.
Your adviser will normally keep you informed if the insurer needs further information before making a decision.
Choosing the right insurer
Executive income protection policies differ not only in price but also in how insurers assess occupations, medical history and director remuneration.
A regulated financial adviser can compare providers, explain any underwriting requirements and recommend the most appropriate policy for your circumstances.
If you’d like to compare executive income protection policies, you can get a quote from a regulated adviser.