New IP Products – Changing From Own to Any Occupation


One of the issues raised following the launch of the new income protection insurance product ranges in October has been the inclusion of clauses in many of the new contracts which will see IP policy holders assessed under an Any Occupation definition after two years on claim.

This issue was raised by NSW adviser, Andrew Sherlock, during Riskinfo’s 2021 Income Protection Round Table discussion. According to Sherlock, the move to use an Any Occupation definition to assess clients who have been on claim for more than two years, but who had previously been assessed under an Own Occupation definition, was the most concerning element contained in the new era of IP products (see Round Table Part 1 video, 08:26).

Addressing this point following the completion of the Round Table discussion, Zurich’s Risk Strategy Specialist – Life Risk, Adam Crabbe, provided some additional perspectives, which included:

  • APRA’s IP Intervention guidelines offered product manufacturers a number of options to address sustainability issues, only one of which included moving to an Any Occupation definition after two years on claim.
  • Some new IP products reduce the income replacement ratio after two years on claim, rather than changing the occupation definition.
  • Some product versions in the new range include both clauses.
  • Acknowledgement that the vast majority of all IP claims are settled inside the first two years, but for longer-term claims, the agenda is almost universally a shared goal between claimant and insurer, whereby the ultimate goal is to return to work as much as is feasible, subject to the nature of the disability.

Click below to watch Adam’s full response…

To access summaries of the new range of IP products, which include details of the treatment of Any and Own Occupation definitions while on claim, see also: APRA’s IP Intervention – New Product Releases.