Lifestyle Protection plan aims to cover you and your family against the financial impact of death an...
Lifestyle Protection plan aims to cover you and your family against the financial impact of death and/or critical illness. You can choose either of the following covers from within the Lifestyle Protection plan:
Life Cover
The term of cover will be between five and 40 years and is shown on your quote.
Life or Critical Illness Cover
We will pay the life or Critical Illness (CI) cover when the first of the following happens during the term of the cover:
- Death;
- Diagnosed with a terminal illness;
- Diagnosed with, and the diagnosis meets our definition of one of the critical illnesses shown on our list. Life or CI cover will only pay out once.
We will not pay out a terminal illness claim if you are diagnosed with a terminal illness in the 12 months immediately before the date your Life or CI cover ends.
Options include:
- Increasing cover;
- Decreasing cover in line with a repayment mortgage with a rate of 7% p.a.;
- Guaranteed or reviewable premiums
- Flexibility to increase or decrease the amount of cover;
- Flexibility to increase or decrease the term of the cover.
Product distribution
The plan is not sold through IFAs but distributed direct through theidol.com.
Type of plan
The plan offers life cover on its own, or combined life and CI cover.
Underwriting process
The client and adviser complete an online application including medical questions. Instant or near instant decisions are given where possible. Further underwriting, if required, employs 'Little T' tele-interviewing to collect further relevant information. Further underwriting, if required, may include requests for MER/other specific tests.
Discount for exclusions
There is no discount applied where one or more critical illnesses are excluded.
Minimum/maximum age
18 or over, and currently resident in the UK, and will still be resident in the UK when plan starts. The maximum age at entry for accelerated Life or CI cover is age 64 attained for reviewable rates and for guaranteed rates it is age 54 attained. The minimum term is five years. The maximum age at expiry for accelerated Life or CI is age 69 attained where reviewable premiums are selected, and age 64 attained when premiums are guaranteed.
Minimum/maximum sum assured
There is no minimum sum assured. This is determined by the minimum premium. The maximum sum assured is £500,000. The critical illness benefit is an acceleration of the associated life cover.
Minimum premium
The minimum monthly premium is £5. Premiums can only be paid on a monthly basis, annual and single premiums are not permitted.
Guaranteed premium rates
Life rates are always guaranteed throughout the term for Life cover. Accelerated Life or CI cover is available on either a reviewable or a guaranteed basis.
Number of years before the first premium review
For reviewable cover under the Lifestyle Protection plan, payments are guaranteed for the first five years and then reviewable every five years after that.
Renewable rate option under the plan
Renewable rates are not available with this plan.
Automatic sum assured indexation available
Sum assured indexation is available. On each anniversary of the date the plan started, the amount of cover will increase by the percentage increase in the United Kingdom Government's Retail Price Index (or such other index as Bright Grey shall determine) over the 12 month period ending three months before the anniversary of the date the plan started, subject to a minimum of 2% and a maximum of 10%.
Basis on which indexation increases are costed (e.g. age att/outset)
Premiums are based on the age of the person covered at the date of increase.
Increasing lump sum covers
On each anniversary of the date the plan started, your payment for any increasing lump sum cover will increase. The amount of the increase will depend on the amount of the increase in the amount of cover; the age of the person covered at the date of increase; the remaining term of the cover; the payment rate we charged at the date cover started; any additional payment you are making because your plan was not accepted on standard terms. We will tell you how much the increase is at least one month before the increase takes place.
Plan basis
The plan is available as a single life plan or on a joint life first death basis.
Joint life same sex plan available
Joint life same sex policies are available.
Joint life plan with three or more lives assured
Not available.
Split trust wording available
A split trust wording is available. However, a Bright Grey trust form must be used.
Plans available to foreign nationals resident in UK
Bright Grey will allow foreign nationals to take out a plan providing they are permanently resident in the UK.
Monthly policy fee
The monthly policy fee is £1.50
Waiver of premium available
Waiver of premium is not available.
Plan offers the option to buy-back life cover after a claim
Life buy-back option is not available.
Plan offers the option to buy-back CIC after a claim
Critical illness buy-back is not available.
Option to vary term after start date other than by GIO
A planholder can request increases and decreases to the term and many other alterations to the plan at any time. Changes may require fresh medical evidence.
Plan permits variations to sum assured other than by GIO
A planholder can apply to increase or decrease the sum assured at any time. Changes may require fresh medical evidence.
Variations to plan by endorsement to policy
Plan variations are dealt with by endorsement to the policy.
Guaranteed insurability option
There are no guaranteed insurability options on this plan.
Number of years to qualify as a non-smoker
The non-smoker time limit is 12 months.
Period within which a claim must be notified
There is no specified claim notification period. The life assured should notify the insurer as soon as they are aware they have a claim.
Free cover during underwriting
Not available.
Does the product offer access to support helplines
Helplines are not available.
Claims support services
Not available.
Health & wellbeing services
No health and well-being services are available under the plan.
Critical Illnesses
The 23 ABI defined conditions are covered.
Number of other conditions covered
There are no other conditions covered.
Children's benefit
Children's critical illness cover is not included.
Basis for inclusion of TPD
Total permanent disability is not available.
Exclusions
There are four exclusions for critical illness cover, as follows:
- Intentional self-inflicted injury;
- Inappropriate use of alcohol or drugs, including but not limited to the following:
- consuming too much alcohol;
- taking an overdose of drugs, whether lawfully prescribed or otherwise;
- taking controlled drugs (as defined by the Misuse of Drugs Act 1971) otherwise than in accordance with a lawful prescription;
- Taking part in a criminal act;
- War, invasion, hostilities (whether war is declared or not), civil war, rebellion, revolution or taking part in a riot or civil commotion.
Specified geographic areas excluded
This is not excluded, but Bright Grey will not pay a claim for a critical illness if the life assured is living or working outside the UK and they may have to return to one of these countries to make a claim:
- The United Kingdom, Australia, Austria, Belgium, Canada, Channel Islands, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Gibraltar, Greece, Hong Kong, Hungary, Iceland, Ireland, Isle of Man, Italy, Japan, Latvia, Lithuania, Luxembourg, Malta, The Netherlands, New Zealand, Norway, Poland, Portugal, Slovakia, Slovenia, Spain, Sweden, Switzerland, USA.
Suicide excluded
Suicide is excluded in the first 12 months after the policy start date.
ANALYST'S COMMENT
Lifestyle Protection Plan is a life and critical illness product marketed direct to consumers through theidol.com, the online protection brokerage.
Based on the criteria by which we usually analyse this type of plan, it scores slightly below average, but this is to be expected when compared with IFA oriented products complete with all the 'bells & whistles' demanded by that distribution channel. Direct to consumer products have to be simple and easy to understand so they can be sold online without advice.
The plan covers the 23 ABI defined critical illnesses but does not offer waiver or guaranteed insurability options although the sum assured and term can be increased or decreased as required. The maximum benefit level is £500,000 and the cover is available on an increasing or decreasing basis. A combination of online submission and telephone interviewing places the business on the books.
It is perhaps disappointing that CI cover is not extended to children of the assured as this is a popular benefit with many people and accounts for a sizeable percentage of claims.
However, the protection gap remains a major problem which IFAs have been unable to plug on their own simply because they do not reach a wide enough audience. As people become more internet savvy, the prospects for selling protection online are good. IFAs can compete with the direct channel by offering a value added service but for those people who do not have access to an IFA, products such as this, bought direct, will be an important way of getting the cover they need.
- Ben Heffer, Principal consultant, life and protection, Defaqto.
