Canada Life has expanded its UK individual protection insurance range (it already offers whole life insurance through Canada Life International) by launching four new onshore products:
* CanProtect Level Term.
* CanProtect Decreasing Term.
* CanProtect Level Term Plus. This adds critical illness, intensive care and funeral cover for children.
* CanProtect Decreasing Term Plus. This adds critical illness, intensive care and funeral cover for children
This review focuses on the CanProtect Level Term Plus plan. The product includes:
* A lump sum payment on death or on becoming totally and permanently disabled within the chosen term.
* Or on being diagnosed with a terminal illness where the customer is not expected to live for more than 12 months (this is not payable if diagnosis is within 12 months of the policy end date).
* A lump sum payment on diagnosis of one of the listed critical illnesses. This is paid provided the customer survives for at least 14 days from when they meet the definition.
* Payment of £7,500 if hospitalised with physical injuries for a minimum of 28 consecutive days immediately following an accident. This benefit is not payable more than twice.
* A lump sum if one of the customer’s children suffers one of the listed children’s critical illnesses. Again, a 14 day survival period applies. This sum is the lower of £25,000 and 25% of the sum insured. Children’s intensive care benefit pays a similar sum if a child requires continuous mechanical ventilation for a period of seven consecutive days due to sickness or injury. Children’s funeral cover pays £10,000 on death (maximum two payments).
The critical illness covered are: Alzheimer’s disease; aorta graft surgery; aplastic anaemia; bacterial meningitis; benign brain tumour; blindness; cancer; cardiac arrest; cardiomyopathy; coma; coronary artery bypass grafts; Creutzfeldt-Jakob disease; deafness; dementia; encephalitis; heart attack; heart valve replacement or repair; HIV infection; idiopathic primary pulmonary hypertension; kidney failure; liver failure; loss of a hand or foot; loss of independence; loss of speech; major organ transplant from another person; motor neurone disease; multiple sclerosis; multiples system atrophy; open heart surgery; paralysis of a limb; Parkinson’s disease; progressive supranuclear palsy; removal of a complete lung; rheumatoid arthritis; severe lung disease; spinal cord stroke; benign spinal cord tumour; stroke; systemic lupus erythematosus; third degree burns; traumatic brain injury, and ulcerative colitis.
An additional payment of 25% of the sum insured (or £25,000 if lower) is paid on suffering coronary angioplasty; urinary bladder removal; ductal carcinoma in situ of the breast treated by surgery; carcinoma in situ of the testicle; carcinoma in situ of the urinary bladder; cerebral aneurysm of the brain; cerebral arteriovenous malformation of the brain; Crohn’s disease; chronic hepatitis B or C; infective bacterial endocarditis; lung lobectomy; pericarditis; pituitary gland tumour; early stage prostate cancer; removal of an eyeball, and visual impairment. The additional critical illness benefit is payable no more than four times on single life and six times on joint life policies.
The plan also offers waiver of premium benefit deferred period 13 weeks). Maximum cover varies from £75,000 at ages 61-65 at outset up to £400,000 at ages 18-40 at outset. All benefits stop if premiums remain unpaid after 60 days. The plan is available on a single life or joint life first event basis for customers aged below 66 and cover can last up to age 70. Premiums can be reviewable or guaranteed.
A medical treatment sourcing service is included, along with a bereavement and probate line. There is also a personal care assistance programme supported by an online health risk assessment tool and a second medical opinion service plus the Red Arc nursing support service for claimants.
Exclusions are fairly standard, with suicide being excluded during the policy’s first 12 months.
What They Say
Propositions and marketing director, distribution, Nick Harding, said: “Our new onshore CanProtect protection plans are designed to suit every budget and level of cover, providing genuine innovation in terms of the client purchasing process and support that policyholders will receive. In a market which is constantly being challenged to grow, we believe the combination of UnderwriteMe technology and the tangible support we offer provides a unique opportunity to reposition protection as a priority rather than luxury consumer purchase. We believe we can achieve the same position for the individual protection market as we have for the group market, where we are recognised as a leader in technology and value.”
What We Say
"On the face of it, Canada Life’s move to offer individual term and CI insurance cover looks like another case of ‘me too’ marketing. However, while many of the four plans’ benefits do fall into that category, Canada Life’s proposition is rather more than that.
"First, plans have been developed with UnderwriteMe, not just for its underwriting engine and straight through processing but also to manage which IFAs the plan should be sold through. So, that means not every IFA will (yet) be able to sell these plans, but it also means Canada Life and UnderwriteMe can control volumes, which should lead to optimal service standards. The first intermediary chosen to pilot the plans was LifeSearch.
"In terms of benefits, Canada Life covers 58 conditions, of which 42 are core and 16 are additional payment conditions. You need to go to something like CI Expert to determine whether that list is better or worse than its main competitors – in reality it is both, so customers and advisers have to make a value judgement on which condition definitions are most important to them.
"The add-on services are useful and practical and I’m delighted to see the waiver of premium benefit having just a three month deferred period – too many plans have a much less attractive six month deferred period. Similarly the non-forfeiture period is a reasonable 60 days.
"There are a couple of oddities in the literature – a pet hate is using the word ‘assurance’ when most customers better understand ‘insurance’ (interestingly, the press release uses both insurance and assurance). You also have to go to a separate guide to find the definitions for and even the list of critical illnesses covered and the policy document doesn’t specify which edition of that guide applies at any time.
"But these are relatively minor gripes. The most exciting factor is that Canada Life seems determined to expand the market not just go for a share of the existing market. It looks to be doing so in a careful, even cautious way, but if it can achieve that objective it probably deserves an even higher rating!"