Income protection needs to strip out the state benefits element if the product is to move upwards, a consultancy firm has stated.
According to Chiltern Consulting, the complexity of IP was the main problem with the under-sold product area and state benefits should not be taken into account.
Phil Veale, owner of the firm, said while the recent Review of Simple Financial Products proposals for a simple IP product could be commended he could not see it happening.
He said: "The state benefits will change constantly so trying to match that with a simple product concept will just be too much of a challenge.
"IP products should just ignore the state benefits and market the products that way. If people pay a premium they should just get what they pay for and state benefits are irrelvant. I am not sure why providers do not innovate like this."
Veale said the market was "pretty weak" for individual IP but added: "It will not get worse. There is some good innovation going on, for example Exeter Family Friendly is doing quite well with making things more straight forward."
The Income Protection Task Force said on Monday that ensuring simple IP was included in the Review of Simple Financial Products outcome was part of its current three-point plan for IP.
