Legal & General group income protection policies will automatically track the higher national insurance rates from 6 April 2022.
The insurer confirmed this extended cover will also include the new Health and Social Care Levy from 6 April 2023, for all new and existing clients.
It says that premium rates would not be affected by this change, while the policy is within its rate guarantee period.
Last year the government announced it will raise additional money from employers, employees and the self-employed via increase NI payments to directly support the NHS and, from 2023, social care in the UK.
For employers, NI rates will increase from the start of the next tax year, with employers and employees paying an additional 1.25 percentage points on the current rate.
From 6 April 2023, NI contribution will return to the 2021/22 level, but the government will introduce its new health and social care levy. The new levy will share the same reliefs and thresholds as NI.
However, the government will also start collecting levy payments in respect of employees who no longer pay NI because they’ve reached state pension age
For new claims, the NI rates and thresholds that apply when an employee goes absent will apply throughout the claim. If the claim is already in payment, Legal & General will not apply any adjustments in line with NI rate and threshold changes.
Legal & General Group Protection distribution director Colin Fitzgerald says: “While the impact on employees has been well documented since the government’s announcement of the change to NI contributions and the introduction of the Health and Social Care levy in 2023, the impact on employers arguably hasn’t.
“With this announcement, we hope to reassure our clients – current and future – and intermediary partners of our approach, in that the new levy will be automatically accounted for.”
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