Glossary

Income multiple cap

Also called income multiple, financial underwriting.

The limit on cover relative to income, which is why insurers ask what you earn.

Insurers cap the cover they will issue as a multiple of annual income. The multiple is generally higher for younger applicants and falls with age.

This is why income is asked early in any application, and why a cover figure arrived at from your own needs may sit above what would actually be issued.

Related terms

  • Non-medical limit The most cover an insurer will issue on a declaration alone, without a medical examination.
  • Income proof Documents evidencing what you earn, required once cover or premium passes a threshold.
  • Underwriting The insurer's assessment of the risk you present, which decides the terms and the price.

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