Irish pension firm to ‘pay out more to unhealthy clients’
An Irish pension company has announced a controversial policy which would see unhealthy customers receive a higher monthly payment than their clean living counterparts.
This is because they are not expected to last as long as healthy customers.
The firm – Irish Life – is the largest pension provider in Ireland. It says that people with unhealthy lifestyles or medical conditions could receive as much as 25% more income. The average increase is likely to be around 10%.
The Irish Times report that up to six out of ten customers could benefit from the system.
Customers could qualify for a higher income if they smoke, are overweight, excessively underweight or obese, have high cholesterol, type 2 diabetes or high blood pressure.
Customers with illnesses such as multiple sclerosis, cancer or medical conditions such as heart problems could also qualify for higher payments.
Irish Life’s system works by determining a monthly figure to pay out from a customer’s pension pot based on their ‘expected future lifespan’.
The shorter the life expectancy, the higher proportion of the pension pot will be paid out every month.
It allows the customer to make the most of their pension while they’re still alive.
While it may seem like good news for people with health problems who are coming up to their pension age, it could be seen as discouraging them from making an effort to improve their lifestyle.
It could also be seen as penalising healthy living clients who would receive lower pay-outs, over an expected longer period of time.