Summarys
The need to clarify the wording of policies, in particular those relating to critical illness cover. The innovative introduction of placing illnesses into types, which will offer customers a greater choice of life insurance.
Few of us are insured against serious illness even though it may strike unexpectedly. Legal and General, the income protection provider, has carried out investigations that reveals only 4.2% of the country’s work force possess critical illness cover, even though they will get a lump sum if they have a stroke, heart attack or suffer from cancer.
17% of people think the cover to be too costly, the survey reveals, which give reasons for the low take up.
Potential customers are also baffled by the wording of policies and the disparity between permanent health cover and critical illness insurance.
A working party formed by the Association of British Insurers, is at this time reviewing the wording of policies. The situation could become even more baffling if the working party decides to lessen the number of illnesses defined as a critical illness.
Legal and General have launched a new plan called Elixia 123, which it declares cuts the price of critical illness cover by around 26 per cent and on occasions by upto 48 per cent.
This will be attained by permitting customers to pick the illnesses for which they require cover. There are three categories of risk. Group one. Strokes, invasive cancer and heart attacks. The plan will only pay out if the disease leads to major life style changes or is life threatening.
Group 2. Conditionsthat dramatically affect life style but do not have much impact on life expectancy. Alzheimer’s, blindness and Motor neurone disease are included in this group.
Category three. Conditions
Critical illness cover is not that pricey so it is sensible to opt for a comprehensive policy, which will give you security.
Jennifer Green, the distribution development manager at BUPA, is concerned about how the jargon is explained. She emphasises that customers must understand exactly what they are purchasing. For example, when is a condition defined as major? The 1st and the 3rd groups need clarification before taking insurance as there is not much difference between them in her view. Difficulties can happen later if the customer has not fully appreciated the terms of the insurance policy when they Moria Jennings.