Norwich Union

Maximum age at entry: 54

Maximum annual benefit available: The maximum benefit is £120,000 a year, regardless of earnings. However, index-linked increases will be on top of this amount.

Retirement ages: 50, 55, 60 or 65

Option for benefits to be paid for a limited period:

No

Option to increase the retirement age after start date (other than guaranteed insurance option (GIO)): No

Increase benefit subject to underwriting: If the life insured is not eligible to use the GIO they may still apply to increase cover under a top-up plan. Minimum levels of premium or plan charges will not apply.

Regular cover review: Customers are urged to consider how earnings and living costs have changed since they last reviewed their cover. They may be able to increase their cover by more than the retail prices index (RPI) on the anniversary of the plan. It will be subject to a fresh assessment of their health, earnings, occupation and pastimes. Premium payments will increase. Customers can also decrease their cover.

GIO options available: Under this option the insured person may effect further policies of this type if normal underwriting terms (with no premium loading or non-standard exclusions) have been applied to the original policy, but the new policies cannot include any additional options which were not included in the original policy. The minimum premium and policy charge will not apply to the new policy. The new policy can be issued without the need for further evidence of health, but will be subject to Norwich Union Healthcare terms and conditions.

The following increases are allowed:

Up to the amount of an increase in the insured person's share of the mortgage payment, due to a home move or improvement, a mortgage discount period ending or the insured person becoming sole owner of the property following a legal separation.

Up to £250 per month on the insured person getting married.

Up to £250 per month on the insured person becoming a parent.

Up to £500 per month on the insured person receiving a significant salary increase (at least 20%) as a direct result and immediately following attainment of a professional qualification.

Number of increases allowable: There is no limit on the number or combination of the above increases allowed, except the monthly benefit under all policies remains subject to the overall maximum of 60% of earnings, as per benefit level.

Deferment period: The new policy must not have a deferred period shorter than that applying to the original policy, but the termination age may be extended by five years, subject to a maximum termination age allowed as standard for the insured person's occupation, or any lower termination age Norwich Union has imposed on the original policy.

This option cannot be exercised if the insured person has been subject to any incapacity after the commencement date (except incapacity not resulting in a claim and which ended at least three months ago).

Index-linking: The benefit will be increased annually at each anniversary date, irrespective of any deterioration of health, in line with the RPI (or a replacement of that index acceptable to the firm), as declared three months prior to the month in which the anniversary date occurs. The increase at any anniversary date may be declined within one month of being notified of the change.

Limitations on increases: During a claim, increases will be limited to a maximum of 12% of the benefit being paid, or the RPI, whichever is lower.

Plan available without indexation: Indexation is automatically included. However, the policy holder is able to decline the annual increase if they choose to do so.

Reviewable premium rates: The initial premium for the initial benefit is guaranteed for five years on or after which Norwich Union reserves the right to review the premium at each anniversary date.

Career break available: If a customer decides to take a career break they can arrange to maintain cover at the level of houseperson's benefit. If they return to work within five years, they can arrange to increase their cover back to the previous level without needing medical evidence after they have been at work for three months.

Houseperson cover available: Cover is available for housepersons to a maximum benefit of £12,000 a year. To be eligible the customer must be able to satisfy the criteria of a personal capability assessment.

Proportionate benefit available: If they are totally disabled and, as a result of illness or injury, unable to perform their previous occupation but undertake a different occupation with a reduction in normal earnings, the benefit payable will be a percentage reduction of their normal earnings applied to the total benefit.

Relapse benefit available: The deferred period will be applied to each period of the disablement. However, if a claimant has been in benefit and is disabled again from the same or related cause within 12 months of cessation of benefit, the deferred period will not be reapplied.

Benefit payable during unemployment: If an insured person is unemployed for more than three months, cover can be maintained up to a maximum benefit of £12000 a year.

Hospitalisation benefit available: If the claimant, as a direct result of incapacity, has spent more than seven consecutive nights in hospital Norwich Union will pay £75 for each subsequent night to a maximum of 90 nights, during the deferred period.

Disability counsellors: Norwich Union Healthcare has its own disability benefits advisers.

Cover operates worldwide: Worldwide cover is available to residents of the UK, the Channel Islands or the Isle of Man.

Death benefit available: Yes - If the policyholder dies during the first 12 months of claiming monthly benefit, resulting from the same illness or injury being paid, Norwich Union will pay a single payment of 12 times the last monthly benefit paid, less any benefit already paid.

Benefit percentage limit based on total income: Yes

Number of salary tiers used in maximum benefit calculation: One

Other insurances deducted from benefit amount: Yes

Pension income deducted from the benefit amount: Unless received prior to incapacity.

Notification of a change in occupation required: The policyholder does not need to notify Norwich Union if they change their occupation or duties post acceptance.

Standard definition of disability: Own - if incapacitated as a result of illness or injury and unable to perform the duties of his or her normal occupation for profit or reward, full benefit is paid.

Own occupation definition of disability: If incapacitated as a result of illness or injury and unable to perform the duties of his or her normal occupation for profit or reward, full benefit is paid.

Any suited definition of disability: For certain occupations full benefit will only be paid if the customer is incapacitated as a result of illness or injury and unable to perform any occupation for which he or she is qualified by reason of training, education or experience and is not undertaking any other occupation.

Analyst's comment

The SafeGuard plan offers comprehensive income protection cover supported by excellent rehabilitation services. Norwich Union is a rare example of a provider that promotes its claims management as a positive part of the income protection proposition, extending the scope of cover to more than issuing monthly cheques.

SafeGuard provides a range of deferred period options with the facility to arrange tiered cover to dovetail with employer sick pay or other insurances. The maximum benefit of 60% of salary is higher than many, although Norwich Union does deduct some short-term income benefits.

The plan provides ongoing flexibility through guaranteed insurability options on childbirth, marriage, mortgage increase and salary increase, and indexation is automatically included. Payments can recommence for linked periods of incapacity for 12 months, longer than the majority of the market. Hospitalisation benefit is available together with a lump sum benefit on death.

Although the absence of full term guaranteed premium rates may limit its appeal, Norwich Union offers comprehensive intermediary support through its online Healthcare Zone which contains extensive market information and point of sale literature.

Nick Telfer, head of life and protection, Defaqto