Protection Account
Minimum acceptable monthly premium: £5
Maximum age at attained at entry: 59
Minimum annual benefit available: £1,200 pa or £100 per month.
Maximum annual benefit available - income protection (IP) cover limitations:
The maximum amount payable under all IP covers under this AXA Protection Account in any month will be worked out as follows:
- If the pre-incapacity earnings of the person covered are less than £30,000 the maximum amount will be a 12th of 65% of those earnings.
- If the pre-incapacity earnings of the person covered are greater than £30,000 the maximum amount will be one twelfth of 65% of earnings up to £30,000, plus one twelfth of 40% of earnings in excess of £30,000.
- In any event, the maximum amount payable in any month is £11,000. If the cover holder is not in full-time employment or a student at the time of a claim, the maximum amount payable in any month is reduced to £1,250 and the cover limitations in the above conditions.
Retirement age:
Term must not extend beyond 65th birthday of the person covered, and must be to an exact age between the 50th and 65th birthday of the life assured.
Increasing the retirement age after start date other than by guaranteed insurability options (GIO):
The account owner can change the way the cover is set up, for example increasing or decreasing the amount of cover or changing the length of cover. Any increase in the amount of cover, reduction in the deferred period or extension of the period of the cover is subject to underwriting.
Increase benefit subject to underwriting:
The account owner can change the way the cover is set up - for example increasing or decreasing the amount of cover or changing the length of cover. Any increase in the amount of cover, reduction in the deferred period or extension of the period of the cover is subject to underwriting.
GIO options available - option events:
- Marriage
- Childbirth/adoption
- Moving home or home Improvement
- Career change or promotion
- Divorce or separation
When GIO is not available:
- If the person covered is not an account owner
- On cover taken out through a GIO
- If there are payments outstanding
- If the cover is subject to a claim
GIO insurability offered to standard rated cases only:
GIO available only when the person covered has been accepted at standard rates and on standard terms.
Plan available without indexation: Yes
Guaranteed premium rates available:
If payment basis is shown as guaranteed, the factors used to work out the payments for the relevant cover will not change before the cover end date.
This does not mean the amount of payments will stay the same - it will change if cover is changed and it will increase as described in the "payment type - increasing" section if the amount of cover is increasing.
Career break available if the person covered stops working:
Provided payments continue to be made, cover will continue to be valid during periods of:
- Unemployment
- Maternity leave
- Career break for any other reason
If incapacity starts during the first six months of any such period the definition of incapacity as shown on the relevant cover schedule will be used. If incapacity starts after the first six months of any such period, incapacity will be determined using an "activities of daily work" definition.
Reviewable premium rates:
If payment basis is shown as reviewable, the factors used to work out the payments for the relevant cover have been chosen to cover the whole period of the cover but may be reviewed as set out below.
The payments for the relevant cover will not be changed before the fifth anniversary of the cover start date. After this date payments may be reviewed at any time. If, following a review, payments change, payments will not be reviewed for a further five years.
Houseperson cover available:
If the person covered is a houseperson, not in full-time employment or a student at the time of a claim, the maximum amount payable in any month is reduced to £1,250.
Relapse benefit available - linked claims:
A linked claim happens if the person covered returns to work after a valid claim but suffers incapacity again within 12 months of returning to work, provided:
- The firm is informed within three weeks of the date on which the person covered stops work again.
- There has been no change of occupation of the person covered between the two periods of incapacity.
- The person covered is incapacitated from the same or a related cause.
- The person covered did not go back to work against the advice of their doctor.
On a linked claim we will not apply the deferred period on the second period of incapacity.
Benefit payable during unemployment if the person covered stops working:
Provided payments continue to be made, cover will continue to be valid during periods of:
- Unemployment
- Maternity leave
- Career break for any other reason
Hospitalisation benefit available:
AXA will pay a claim if, during the deferred period, the person covered is confined to hospital for six or more consecutive nights.
How much will be paid:
The amount paid for each night will be equal to a 30th of the amount of the monthly IP cover or mortgage IP cover as at the date the person covered was admitted to hospital, subject to a maximum payment of £200 for each night. The amount paid starts from the sixth night.
How long the claim will be paid:
Hospitalisation cover claim payments will continue until the first of the following occurs:
- The person covered spends 13 consecutive weeks in hospital.
- The person covered leaves hospital.
- The end of the shortest deferred period for any IP cover or mortgage IP cover.
What will stop the IP cover and mortgage IP cover from paying out:
Claims will not be paid if:
- The incapacity was caused by unreasonable failure to follow medical advice.
- The incapacity was caused by any excluded cause shown on the cover schedule.
- The incapacity was caused by alcohol or solvent abuse, or the taking of drugs except under the direction of a registered medical practitioner.
- The incapacity was caused by intentional self-inflicted injury.
- The conditions giving rise to the claim are a result of the normal pregnancy of the person covered, except where the person covered is experiencing pregnancy complications.
- Medical or other evidence required by us is incomplete or inaccurate.
- The claim was caused directly or indirectly through infection by any human immunodeficiency virus (HIV), acquired immune deficiency syndrome (Aids) or related complex unless covered under our definition (see our critical illness guide for the HIV definition).
- The person covered has been resident outside of any of the permitted countries for longer than 12 months.
Covers available:
Life; critical illness; payment protection; IP; mortgage IP; accident and sickness; unemployment; household; buildings household; and life or earlier critical illness.
ANALYST'S COMMENT
Menu protection plans have become de rigueur over recent years as the industry looks to encourage holistic protection planning. A relatively recent addition to this market is the AXA Protection Account which offers a wide range of protection benefits within a single plan wrapper.
The account offers income protection insurance on a guaranteed or reviewable premium basis and can be structured to replace lost income or cover mortgage related payments through the mortgage income protection option.
Cover can be tailored to fit most client needs. An own occupation definition is offered with an alternative task-based definition applied to higher risk occupations and houseperson benefit.
Cover can be adapted to match changing needs through a range of guaranteed insurability options, with ad hoc changes permitted subject to evidence of insurability.
Maximum benefits are assessed using a tiered calculation which adds complexity when setting up the plan and unfortunately, as with a majority of income protection plans, there is no contingency to refund overpaid premiums when benefits are restricted.
The scope of the cover is extended by the automatic inclusion of hospitalisation cover providing up to £200 a night benefit for up to 13 weeks which compares favourably with the market.
For a protection menu to be successful each of its components must be able to stand comparison in its peer group and the income protection element of the AXA Protection Account does this.
