In the belief that there is a growing demand for PHI due to changes in state benefit legislation, Scottish Widows has taken its first steps into this market. It aims to be a top five provider within the next three years.
The Disability Income Plan is reviewable, with premiums guaranteed for the first six years, compared with five years for many of Widows' competitors.
Scottish Widows has chosen this basis as it believes this method provides better value for money than guaranteed premium plans.
For a non-smoking professional male aged 30 next birthday with cover ceasing at age 60 for 26 weeks deferred paying a level benefit of £15,000 a year, Scottish Widows' prem ium is £13.13 a month compared with £12.43 from Permanent and £19.37 from Zurich Life.
However, the Scottish Widows plan includes the additional benefit of a lump sum of 50 per cent of the annual benefit in the event of severe disability.
The plan also includes wider geographical coverage than many of its rivals, providing protection even if the client is resident outside the UK, although there are some exceptions.