Income protection: use a broker or go straight to provider?

Q

qwerty-2023

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Hi everyone,

Just dropped out of my employer-facilitated group income protection scheme because they raised the ordinary premiums to 2% of gross pay which is twice as much as I’m being quoted using online comparison tools. For context it’s a public sector group scheme.

When contacted for further details about any comparative advantages justifying the premium the administrator just said that the scheme is designed around my sick pay entitlements “which is a significant benefit” but didn’t elaborate.

So how should I proceed to sign up for an alternative income protection plan? Do I go straight to insurers based on online automated quotes, or is there a benefit to going through a broker? I don’t think I need advice necessarily, but maybe brokers have access to better prices?
 
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FYI

My public service employer, with maybe 2,000+ staff moved to auto-enrolment into the IP scheme.

The broker is Cornmarket, who do a review every five years, and "go to the market".

In 2023 the insurer switched from Irish Life to Aviva.

The premium decreased to 0.85%, with some enhanced benefits (age going from 65 to 66, lump-sum paid for some illnesses, etc.)

Disability benefit 0.78% + specificed illness 0.07% = 0.85% gross.
 
Surely the trade unions have a role here?

If your partner's scheme is 0.58% and mine is 0.85%, and yours is 1.98%, surely your trade union should know about these comparisons, and highlight them?
 
qwerty-2023 said:
I don’t think I need advice necessarily, but maybe brokers have access to better prices?
Click to expand...
You might get a discounted price on an execution only basis but that would mean you choose the product provider from outset that you want the policy to be with, furnishing the intermediary with all the details for the quote (including the exact sum insured) and just asking for a price.
 
Thank you all for your helpful replies! Apologies I can’t figure out how to reply to specific posts on mobile so I’ll do it in one go in this post. Also apologies I removed a bit of detail as I realised it might be easy to identify me based on the specifics I provided (though this might be a bit paranoid of me!).

@Protocol : Thank you, my scheme has a similar process to yours, they told us that they got quotes from all the main players and out of every insurer the one above was the most competitive… (Note it’s an intermediary who manages the scheme so I’m sure they also add a hefty commission…) they also suggested that in another two years the premium might come back down but I’d rather not be overpaying in the meantime! In addition, my union is Forsa (which covers the entire public sector) but my IC scheme is a smaller one specific to my employer and a few others, so I assume Forsa wouldn’t be interested in helping as the IC scheme they promote is the broader Cornmarket one.

@Steven Barrett : Thank you, me and my partner both have bog standard office jobs and we are both young and healthy (though within both workplaces everyone pay the same premiums anyway so that probably doesn’t impact things) so I am really scratching my head at the price difference! I guess it might be the case that my scheme has an older age profile overall? I was also told that my scheme - and all group schemes in Ireland - have experienced higher than usual claims recently which drove the price increases but who knows how true it is.

@GSheehy : Thank you, I feel relatively comfortable looking things up and determining what cover I need so I’ll probably do it that way then!

@Dr Strangelove : Thank you, that’s reassuring to hear that it worked well for you!
 
qwerty-2023 said:
I guess it might be the case that my scheme has an older age profile overall? I was also told that my scheme - and all group schemes in Ireland - have experienced higher than usual claims recently which drove the price increases but who knows how true it is.
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I did a bit of homework last year comparing the standard occupational scheme with one that you purchase on your own, in my case via broker.

The occupational scheme charges the same rate to all employees so the younger ones tend to be cross subsidising the older ones, as you tend to have more illness as you get older.

The breakeven point seems to be about 47 which I’m still a bit below so I didn’t join the occupational scheme.
 
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