The reduction applies to the accident, sickness and unemployment option as well as the accident and sickness option of the policy.
The firm has also revealed that 85% of all MPPI claims it received between October 2008 and June 2010 have paid out.
The vast majority of MPPI claims it receives relate to unemployment, at 61%, while a further 34% relate to sickness and 5% to accident.
Of the 15% of claims Select & Protect has declined, the major reasons for doing so are that the claim was made within the deferment period or it related to a pre-existing condition.
Bruce Reid, managing director at Select & Protect, says: “The price of the product is always a factor when financial intermediaries are advising their clients but so too is confidence around the product being fit for purpose – in other words paying out on valid claims.
“So while we’re delighted to be able to reduce the rates for the ASU and AS cover options, we’re also confident the claims process for valid claims is delivering on the insurance promise.
“We also recognise that with everything going on in the news right now regarding payment protection insurance, brokers may be reluctant to speak to their clients about MPPI so we hope the claims statistics report is a reminder to brokers and their customers that MPPI should not be associated with the current negativity around PPI. It’s a different product and as our statistics show, as long as the claim is valid, it does pay out.”