Income protection costs more for ladies

Women pay more than twice as much for income protection insurance as men because they make more claims for mental health and stress-related conditions, say insurance companies.

As the insurance industry reports a big rise in the number of New Zealanders taking out income protection policies, premium schedules show women pay significantly more for the products.

For example, a 35-year-old non-smoking man insuring a $65,000 annual income will pay $39 a month for an AIG Life IP policy. A 35-year-old woman with the same profile will pay almost $85.

Premiums go up with age for both sexes, but the disparity remains – at 50 the man will pay $129 a month whereas the woman will pay $270. AIG said it had always been the case that women made more stress-related claims. These claims were expensive, hence the difference in pricing.