The Welfare Reform Act 2007, designed to reduce the number of people claiming incapacity benefit and encourage the long-term absent back into the workplace, is set to have a key impact on employers seeking income protection (IP) insurance.
The legislation, which received Royal Assent in May, is prompting some providers to make changes to their products.
Some current group IP limits, for example, take incapacity benefits into account so need to change.
Unum altered the limit of its offering from 75% less incapacity benefit to 80% without any offset.
While Canada Life increased the maximum benefits through its non-integrated IP product from 66% to 75% of salary.